The UK economy grew by 0.4% in August as more people dined out, went on holiday and attended music festivals, as reported by BBC.
The Economy Picked Up
The Office for National Statistics (ONS) said the services sector made the biggest contribution to economic growth in the first full month after all Covid restrictions were lifted in England.
It said arts, entertainment and recreation grew 9%, boosted by sports clubs, amusement parks and festivals.
There was also more demand for hotels and campsites.
Restrictions on social distancing were eased from 19 July.
“The economy picked up in August as bars, restaurants and festivals benefited from the first full month without Covid-19 restrictions in England,” said Darren Morgan, director of economic statistics at the ONS.
The ONS said economic growth fell by 0.1% in July compared with initial estimates of 0.1% growth.
Small Rebound
Emma-Lou Montgomery, associate director at Fidelity International, said that while August’s growth “marks a small rebound” in July, “the worry remains that economic growth won’t even be within touching distance of pre-pandemic levels until well into next year”.
She said supply chain disruption risks dampening consumer confidence.
“But with households facing steep price rises for everyday items, from the food shop through to the gas bill, there will be little desire – or capacity – to spend, spend, spend.”
But we’re supposed to be bouncing back with growth of 7% this year.
Exports of goods, too, are down by 13% compared with 2018.
But without doubt some, notably the ongoing shortage of lorry drivers, are in large part related to Brexit.
Paul Signifies Drug Epidemic
Elsewhere, economic growth was uneven with some sectors hit by shortages of materials.
Output in construction fell by 0.2% in August and the sector remains 1.5% below pre-pandemic levels.
But it said the output in the manufacture of motor vehicles remains 14.5% below a peak in February this year.
Paul Dales, chief UK economist at Capital Economics, said: “Such drugs may have become more widespread and significant in September and October, with the fuel crisis preventing some people from getting to work.”
“Rising inflation, driven by significant increases in energy prices, and the recent cut in Universal Credit are squeezing consumers’ spending power.”
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Source: BBC
