The UK’s economic recovery is slowly picking up pace as the first effective news on coronavirus vaccines fuels business optimism for 2021. However, the pace of the recovery lagged the global benchmark in November, according to the latest recovery tracker from Lloyds Bank UK.
In partnership with IHS Markit, the Recovery Tracker provides insight into the shape and pace of recovery in the UK from the COVID-19 disorder.
According to the data, eight of the fourteen UK sectors lagged the global index in November, as many as in October.
The tracker shows that tourism and leisure companies lagged the furthest behind the corresponding global benchmark with a score of 15. 6 versus the global benchmark for the sector of 44. 0 when the national ban came into effect in England.
It is worth noting that the reading rises above 50 signals, while a reading below 50 indicates that the output is contracting.
The report says that the beverage and food sector (39. 9) also fell further behind the corresponding global benchmark (52. 4) in November, with manufacturers citing a decline in orders from pubs and restaurants.
The property (40. 6) and transport (47. 5) were the only other UK sectors to see a significant drop in production in November.
While the UK overall underperformed the global benchmark in November, it still outperformed the European benchmark with 12 of the 14 UK sectors. Only tourism and recreation, as well as drinks and food, were below the European average.
Additionally, in November, UK national production fell for the first time in five months (49). 0). However, the drop wasn’t as steep as the drop measured during the first national lockdown, the tracker claims.
Part of this is because manufacturers have been able to operate normally during the last series of lockdowns across the UK. Domestic manufacturers outperformed the service business for the ninth time in a row in November. Metals and mining topped growth rankings for the third month in a row (70). 7), with cars and auto parts back in second place (63. 3).
Ten of the fourteen sectors monitored by the tracker saw production growth in November, with six showing faster production growth compared to the previous month.
The largest increase has been seen in technology equipment manufacturers (61). 3 against 52. 7 in October) and manufacturers of household products (52. 7 vs.. . 45. 0 in October).
The surge in technology equipment production in the UK reflected a global recovery in the sector in November, led by the recovery in the global semiconductor industry, which improved trade flows and stimulated demand.
Manufacturers said the increase in production was partly due to higher export orders in November as European customers moved forward with purchases before the end of the Brexit transition period. The deadline of 31. December also led to a stockpiling of the factories for the first time since October 2019.
While national production declined in November, UK companies were more optimistic about the UK’s recovery in November on news of the first effective coronavirus vaccine.
Almost two-thirds (64%) of tourism and leisure businesses and more than two-fifths (43%) of real estate companies predicted their production would increase in the next 12 months, down from 41% and 43% respectively. 30% in October.
The software and services sector also saw a strong increase in confidence from the previous month (69% expect growth compared to 55% in October) and now has the most positive outlook for the next 12 months of all 14 sectors monitored by the EU. followed by healthcare (68% versus 63% in October).
Jeavon Lolay, Head of Economics and Market Insight at Lloyds Bank Commercial Banking, said: “While the performance of UK service companies has been severely affected by the tightening of restrictions and national lockdowns, there have also been positive signs of resilience to the wider economy as a number of sectors posted stronger growth in November. ”
“News of an effective vaccine has significantly improved business expectations over the past month and may have helped reverse the fortunes of the consumer-facing industries that have borne the brunt of COVID-19 restrictions. ‘
Ed Thurman, General Manager, Global Transaction Banking, Lloyds Bank Commercial Banking, added: “It is gratifying that the news of a viable vaccine is building business confidence for the next 12 months. We are nearing the end of a year that has forced companies to dig deeper than ever and rely on the resilience and innovation they have always shown in the face of adversity. The vaccine will take some time to roll out and the UK’s recovery path from Covid-19 will continue to be determined by a number of far-reaching factors, including the end of the Brexit transition period on Dec.. December. ”
UK, vaccine, coronavirus, economic recovery, economy
News – UK – COVID-19 News: UK sectors lag behind global benchmark but improve after Vaccine Breakthrough – UKTN (UK Tech News)
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