During the second quarter of 2020, UK´s GDP registered a record-breaking deceleration in its y/y growth rate, down to -21.72%. As for the labor market, the unemployment rate increased with respect to 1Q20, registering a rate of 3.97%. The year-on-year growth rate of employment decelerated to 0.34%. The sterling pound depreciated against the dollar and stood at an average exchange rate of 1.24 $/£. Finally, inflation decreased down to a 0.63% rate.

 


Macroeconomic outlook report: UK 2Q20

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Macroeconomic overview

  • During the second quarter of 2020, British GDP decreased by 19.98 p.p. its year-on-year in comparison with the previous quarter, down to -21.72%. This notable deceleration was mainly driven by the downfall of the domestic demand.
  • Regarding the labour market, the unemployment rate stood at 3.97%, after increasing its rate by 0.04 p.p. compared to the first quarter of 2020. The year-on-year growth rate of employment decelerated by 1.03 percentage points down to 0.34%.
  • The sterling pound registered a depreciation against the US dollar of $0.04 per pound and stood at an average exchange rate of 1.24 $/£ during the second quarter of the year.
  • Inflation decreased to a 0.63% rate during 2Q20, well below the 2% target. Furthermore, the Bank of England expects it to fall further below in the upcoming quarters.

For more information, click here to access the executive document in pdf.