UK economy shrank in first quarter as third national lockdown weighed on recovery

Rishi Sunak summer statement

The UK economy shrank during the first three months of 2021 as lockdown measures hindered the country’s recovery.

UK GDP contracted 1.5% during the quarter, according to the Office for National Statistics, after a third national lockdown forced businesses across the country to close their doors again.

However, GDP is estimated to have increased 2.1% during March – the fastest monthly growth since last August – as schools in some parts of the UK reopened. 

The service sector, which includes retail, grew 1.9% during March, the ONS said, suggesting that retail sales continued to “show strength”. 

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