Economic Review – May 2020

Official data has revealed that the headline rate of inflation in the UK is now at its lowest level since August 2016, as the economic fallout from the COVID-19 pandemic continues to force price rises down.

Bank of England Governor, Andrew Bailey has warned the UK economy is at risk of taking longer to recover than initially feared, as data begins to reveal the huge impact the pandemic is wreaking across the economy.

Major benchmarks have rebounded from the lows reached in March as the pandemic tightened its grip. Global markets closed higher at the end of May, despite a tense final day of trading.

The number of people claiming unemployment benefits in the UK has increased dramatically with the coronavirus-related impact on the labour market set to deepen.

Although UK retail sales fell by a record amount during April and survey evidence suggests they remained depressed in May, there are tentative signs that the rate of decline may be easing.