GDP: UK economy shrinks slightly after King’s coronation halted activity

The UK economy contracted in May after businesses across the country downed tools for the King’s coronation, according to official figures.

Gross domestic product (GDP) declined by 0.1% for the month, after increasing by 0.2% in April, the Office for National Statistics (ONS) said.

The contraction was driven by the extra bank holiday weekend for the royal occasion, meaning sectors like construction and finance lost a working day in the month.

Economists had been expecting the economy to shrink slightly more.

Deutsche Bank thought the monthly GDP decline would be 0.3%, while Investec Economics had predicted 0.5%.

The economy had been boosted in April as Britons spent more in pubs, bars and shops.

Darren Morgan, director for economic statistics at the ONS, said: "GDP fell slightly as manufacturing, energy generation and construction all fell back with some industries impacted by one fewer working day than normal."

"Meanwhile, despite the coronation bank holiday, pubs and bars saw sales fall after a strong April... Employment agencies also saw another poor month.

"However, services were flat overall with health recovering, with less impact from strikes than in the previous month, and IT also had a strong month.

"Across the last three months as a whole the economy showed no growth.”

On the latest data, Chancellor Jeremy Hunt said: “While an extra bank holiday had an impact on growth in May, high inflation remains a drag anchor on economic growth.

"The best way to get growth going again and ease the pressure on families is to bring inflation down as quickly as possible.

"Our plan will work, but we must stick to it."

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