Economy rebounds but still lower than year ago

THE UK economy rebounded slightly in February amid the third lockdown but was still almost eight per cent lower than before the pandemic, according to official figures.

The Office for National Statistics said gross domestic product grew by 0.4 per cent, representing an improvement from a 2.2 per cent decline in January.

The February reading was slightly below the forecasts of some analysts, with experts at Investec predicting a 0.7 per cent improvement for the month.

The construction sector saw activity jump by 1.6 per cent for the month amid a lift in new work and maintenance, with production and maufacturing also improving.

Meanwhile, the service sector remained particularly constrained, reporting just 0.2 per cent growth, with hospitality and retail stymied by pandemic restrictions.

The figures also revealed that exports to the EU increased by £3.7 billion – or 46.6 per cent – following a record slump of £5.7 billion in January.

An ONS spokeswoman said: “Exports to the EU recovered significantly from their January fall, though still remain below 2020 levels.

“However, imports from the EU are yet to significantly rebound, with a number of issues hampering trade.”

Suren Thiru, head of economics at the British Chamber of Commerce, said despite the “modest return to growth”, the figures coming after January’s contraction do “little to alter the prospect of a downbeat first quarter for the UK economy”.