Fitch raises UK outlook on economic resilience to pandemic shock

© Reuters. FILE PHOTO: People visit the Stables Market, amid the coronavirus disease (COVID-19) outbreak, in Camden, London, Britain, September 19, 2020. REUTERS/Henry Nicholls

(Reuters) – Rating agency Fitch raised Britain’s outlook to ‘stable’ from ‘negative’ on Friday, saying macroeconomic, labour market and fiscal outturns since the start of 2021 showed the economy was more resilient to the impact of the pandemic shock.

“The roll-out of the UK’s coronavirus vaccination programme has been rapid…which could dampen the impact of infection cases on healthcare capacity and support economic resilience to ongoing developments in the pandemic,” Fitch said.

Last year, the economy shrank by 9.8%, its sharpest slump in more than 300 years and the biggest fall in output of any large advanced economy.

But as lockdown eased, the economic recovery picked up pace in April, with the fastest monthly growth since July leaving output a record 27.6% higher than a year earlier, when the virus was rampant.

The agency affirmed its sovereign credit rating at ‘AA-‘.

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