Britain’s economy could shrink by 35% in the April-June period because of the government’s coronavirus shutdown but then bounce back quickly, the country’s independent budget forecasters said on Tuesday.
However, despite the bounce back, the Office for Budget Responsibility (OBR) still predicted that Britain’s economy could shrink by 13 percent in 2020 in the case of a three-month coronavirus lockdown.
This fall in GDP, they said, “would comfortably exceed any of the annual falls around the end of each world war or in the financial crisis.”
The OBR also projected that Britain’s budget deficit could hit 273 billion pounds ($342.23 billion) in the 2020/21 financial year, five times their previous estimate and equivalent to 14% of gross domestic product.
The projections were based on the assumption that the shutdown lasts for three months followed by another three-month period during which restrictions are gradually lifted, the OBR said.