UK Q4 GDP revised up but 2020 performance still worst on record
The UK economy grew a little more than initially estimated in the final quarter of last year but the performance for 2020 as a whole was still the worst on record amid the pandemic, according to figures released on Wednesday by the Office for National Statistics.
Fourth-quarter GDP grew by 1.3%, up from an initial estimate of 1.0.% growth. This left GDP 7.3% below the fourth quarter of 2019, revised from a previous estimate of 7.8%.
GDP for the third quarter was revised up by 0.8 percentage points to 16.9% growth. However, second-quarter GDP was revised down by 0.5 percentage points to a 19.5% decline.
This means GDP for 2020 as a whole contracted by 9.8%, revised a touch from the first estimate of 9.8% but still the worst contraction on record.
The household saving ratio increased to 16.1% in the fourth quarter from a revised 14.3% in the third. Over the year, the ratio rose sharply, reaching a record high of 16.3%, compared with 6.8% in 2019.
Deputy national statistician for Economic Statistics Jonathan Athow said: "Our revised quarterly figures show the economy shrank a little more than previously estimated in the initial stages of the pandemic, before recovering slightly more strongly in the second half of last year.
"However, these new estimates paint the same overall picture as before, with historically large falls in GDP in the spring, followed by a recovery in the summer and autumn."
Capital Economics said: "The upward revision to GDP in the second half of 2020 means the economy does not have quite as far to recover from the Covid-19 crisis. And Q4’s high saving rate leaves plenty of scope for a rapid rebound in 2021, spurred and financed by consumers."