Britain’s fragile economy was already teetering on the brink of recession even before his death. Queen Elizabeth II last week. That prospect now looms much larger as companies cancel events amid a period of national mourning. bank holiday at the funeral of the dead emperor.
Economists say a full working day will be lost as high street shops close or cut hours on Monday as the UK struggles with growth momentum amid a cost-of-living crisis. , said that production will decline sharply.
Estimates of the economic hit are necessarily crude and rely almost entirely on anecdotal evidence for the time being.there is already A flood of mourners to LondonIt is a boon for hoteliers, taxi drivers, hospitality venues and florists in the capital, making up for losses elsewhere. But it is unlikely to make up for the overall drop in activity.
“We see an increasing risk of the UK slipping into a technological recession,” said Modupe Adegbembo, economist at AXA Investment Managers. “As Britain mourns the Queen’s death, additional bank holidays granted for her funeral will slow growth more than initially expected and increase the risk of the UK slipping into a technological recession this quarter. There is a possibility.”
In its past form, the question is not whether there will be a hit to growth, but how big that hit will be. In 2002, factories, offices and construction sites were closed for a special bank holiday to commemorate the Queen’s Golden Jubilee and in 2012 to celebrate the marriage of the Duke and Duchess of Cornwall and the Duchess of Cambridge. Both were less active as a result of
Over time, the growth of the digital economy has reduced the impact of the extra holiday, but it’s still a double bank holiday to commemorate the Queen’s Day. platinum jubilee This represents a reduction of approximately 0.5 percentage points from the monthly growth rate in June. Given that the UK is her £2.2 trillion economy, gross domestic product would fall from her £10bn to her £11bn if the same thing were repeated next week.
On top of that, there are additional losses associated with business closures and event postponements in the 10 days between the Queen’s death and her funeral. Some of this spending will be postponed instead of being lost forever as the postponed football match is played at a later date and the meeting is rescheduled.
But some of the spending is never recouped, and even a modest decline in gross domestic product in September is enough to tip the balance in favor of a second consecutive quarter of negative growth. The economy shrank by 0.1% in his three months to June. Economists see two consecutive quarters of declining GDP as the technical definition of a recession.
Official figures show economy staged July recovery weaker than expectedmonthly growth of 0.2%, but activity was weighed down by a one-day loss from the platinum jubilee after production plummeted by 0.6% in June.
After Liz Truss announced plans Freeze Electricity Bills for Consumers After October, analysts expect headline inflation to be unlikely to rise significantly above the 40-year record of 10.1% set in July. However, while helping households with their living expenses, ease the severity of the recessionWith families facing gas and electricity costs that are more than double what they were a year ago, it’s unlikely to be avoided entirely.
Paul Dales, Chief UK Economist at Capital Economyhe said he expects GDP to eventually return to previous levels, although some of the growth that would have occurred would be lost. We had already expected negative growth in the second quarter, and now we believe the negative growth in the third quarter will be even steeper.
Some UK sectors and some regions will do better than others. London’s hospitality sector is expected to do good business with crowds flocking to the capital to pay their respects. Coffee sales will go through the roof, but on the whole people don’t produce that much.”
https://www.theguardian.com/business/2022/sep/14/recession-threat-looms-as-uk-grinds-to-a-halt-to-mourn-queen Economy looms over threat of recession as Britain stops to mourn Queen