The economy fared much better than expected during the November lockdown, triggering predictions that a vigorous rebound is on the cards.
Output, or gross domestic product, contracted by 2.6 per cent in November, the Office for National Statistics said.
This would still be a large fall during normal times, but is much smaller than the predictions of 5 per cent.
And while it was the first time the economy had shrunk since April in the depths of the first lockdown, November s decline was a fraction of the 18.8 per cent slump recorded that month.
At the end of November, the economy was 8.5 per cent smaller than its pre-virus size. Ruth Gregory, an economist at consultancy Capital Economics, said the Covid-19 economic hole is now far smaller than anticipated.
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Despite the lingering threat of a no-deal Brexit and a cautious Bank of England (BoE), the British Pound to Euro (GBP/EUR) exchange rate is holding most of its recovery attempt this week. The Euro has seen little impact from news and currency movement in recent sessions, leaving Brexit speculation to be the primary cause of the pair’s movement – which could persist until there is a more concrete outcome for the Brexit process.
Since opening this week at the level of 1.0920, GBP/EUR has been trending with an upside bias, attempting to recover last week’s losses.