Table 1: Google searches related to social consumption  Country  Peak YoY change, %  Italy  -67  Spain  -75  France  -73  Germany  -70  US  -58  Japan  -82  China  -73  UK  -69  Sources: Google and Bank calculations. Table 2: UK “fast indicators” of consumption categories  Category  Peak change, %  Social  -80  Work-related  -65  Delayable  -50  Staple  -5  Total  -30  Source: Bank of England and Bank calculations. GDP data so far broadly corroborates the message from these fast indicators. Compared with the fourth quarter of 2019, UK GDP fell by around 25% during the first four months of this year. The fall in UK-weighted world GDP is likely to have been similarly unprecedented. Unsurprisingly, these would be the sharpest four-month falls in GDP on record, in both the UK and globally. This contraction has affected almost every sector, if to differing degrees (Chart 2). The largest falls have been in the accommodation and dining sectors (over 90%). But sectors such as arts and recreation, construction and education have fallen by more than 40%. Utilities, food production and real estate have been among the least affected. Generally speaking, the greater a sector’s reliance on personal contact, the larger its fall. 4  All speeches are available online at www.bankofengland.co.uk/speeches  4  Chart 2: Falls in output by sector Industry output, hit to level, % Accomm.
The May MPR scenario suggested peak-to-trough falls of 60% and 40% respectively, based in part on results from the Bank’s Decision Maker Panel (DMP). The latest results from the DMP appear broadly consistent with this. Updating Staff’s nowcasts for these high-frequency data gives an estimated fall in Q2 GDP of around 20% relative to its pre-Covid peak. While this is an exceptionally weak number, that is not in itself news. The news is that it is 7 percentage points less than in the May MPR scenario. By comparison, an estimate based on the stringency-based model implies a broadly similar contraction in UK GDP in Q2 of 19% (Chart 7). It could be argued that, while these are large upward revisions in an absolute sense, they are still relatively modest by comparison with the falls already seen. And of course, some of this rise in spending might simply be the release of pent-up demand, which could dissipate subsequently. Against that, the evidence so far suggests the recovery is not simply the bringing-forward of spending. Were this higher level of spending maintained, it would put GDP on a different path than in the May MPR scenario. The cumulative loss of annual GDP in the May scenario, relative to the January MPR forecast, was around  11  All speeches are available online at www.bankofengland.co.uk/speeches  11  17%.