The UK is facing a ‘significant recession’ after economy suffers worst fall since financial crisis.
The nation suffered a 5.8% fall in gross domestic product during March – the biggest monthly fall on record.
Chancellor Rishi Sunak says it is ‘very likely the UK is facing a significant recession this year’.
Figures showed the economy shrank by 2% in the first three months of the year.
The figures are the first official look at the lockdown’s financial effects and show a contraction of 5.8% in March GDP (gross domestic product) alone – the biggest monthly fall on record.
The UK went into lockdown in March in an effort to limit the spread of Covid-19, so the quarterly GDP figure is only a partial representation of the lockdown’s financial impact.
In order for there to be a recession there needs to be two negative quarters back to back which has been predicted. The current quarter ends in June and has been dominated by the lockdown.
Chancellor Rishi said: ‘Techincally a recession is defined as two quarters of negative GDP, we’ve had one so yes , it is now very likely that the UK is facing a significant recession at the moment and this year.’
The Office for National Statistics said: ‘The impacts of the coronavirus were seen right across the economy, with nearly all sub-sectors falling in the three months to March.’
The government are hoping with the lockdown restrictions and with some offices and businesses reopening that the economic downturn can be overturned in the final two quarters of 2020.