UK economy contracts at record rate

The UK economy shrunk at the fastest monthly rate on record in April, contracting by 20.4%, and following on from the decline of 5.8% in March. The coronavirus lockdown was the driver of this significant fall in UK GDP, with services, particularly accommodation, food services, travel, retail and entertainment, being worst hit. Given that the services sector accounts for 80% of UK GDP, this was the main reason for the decline. Other affected areas were trade, the industrial sector and the construction sector. UK equity markets were unfazed by the news, and in fact rose in early trading, recovering from the losses over the previous days.