UK GDP fell by 2% in the first quarter

According to the report from Office for National Statistics, UK gross domestic product (GDP) in volume terms was estimated to have fallen by 2.0% in Quarter 1 (Jan to Mar) 2020, the largest fall since Quarter 4 (Oct to Dec) 2008. Economists had expected a 2.5% decrease.

When compared with the same quarter a year ago, UK GDP decreased by 1.6% in Quarter 1 2020; the biggest fall since Quarter 4 2009, when it also fell by 1.6%. Economists had expected a 2.1% decrease.

This release captures the first direct effects of the coronavirus (COVID-19) pandemic, and the government measures taken to reduce transmission of the virus.

There has been a widespread disruption to economic activity, as services output fell by a record 1.9% in Quarter 1; there were also significant contractions in production and construction.

Household consumption fell by 1.7% in Quarter 1 2020, the largest contraction since Quarter 4 2008, alongside declines in gross fixed capital formation, government consumption and trade volumes.

Commenting on today's GDP figures, Jonathan Athow, Deputy National Statistician for Economic Statistics, said: "With the arrival of the pandemic nearly every aspect of the economy was hit in March, dragging growth to a record monthly fall. Services and construction saw record declines on the month with education, car sales and restaurants all falling substantially. Although very few industries saw growth, there were some that did including IT support and the manufacture of pharmaceuticals, soaps and cleaning products. "The pandemic also hit trade globally, with UK imports and exports falling over the last couple of months, including a notable drop in imports from China."