June pause for the UK economy is recorded

The economic recovery in Britain appeared to lose pace last month as COVID-19 infections increased and consumers spent less money in shops, bars and restaurants.

There are conflicting expectations how the end to lockdown in the United Kingdom, planned for July 19, will impact economic activity and business operations.

Consumer spending has been stronger in recent months, but economists say the declining trends may be due to the recent rise in infection rates.

Measures of economic activity, such as retail footfall, bank transactions and restaurants bookings, decreased throughout June, reported the Financial Times.

The FT report said Google mobility data for June showed visits to retail and recreation centers dropped after surging following the gradual easing of restrictions since January. It also noted that retail consultancy Springboard said retail footfall declined throughout June to 25 percent below June 2019 levels.

Consumer intelligence data from Morning Consult reveals that consumer confidence weakened in the second part of June and government data showed train usage declined.

Gabriella Dickens, UK economist at Pantheon Macroeconomics, told the FT that "most indicators suggest the recovery has paused for breath".

The likely July 19 end to COVID-19 restrictions, announced by Prime Minister Boris Johnson this week, could bring another boost to the economic recovery, say economists.

The policy change "should give the economic rebound new impetus over the summer", said Martin Beck, lead UK economist, at the consultancy Oxford Economics, quoted by the FT.

However, there are warnings that the reopening will mean a surge in virus cases that may hinder consumer spending.

Health Secretary Sajid Javid has admitted new cases could rise to 100,000 per day. This would force many people to self-isolate and hamper employers' business operations. Self-isolation rules are due to be lifted on August 16, nearly a month after lockdown restrictions end.

Any increase in the number of infections "will hold back the economic recovery", said Dickens.

The original reopening date in England had been scheduled for June 21, and the delay has had an impact on the economic recovery, said Maddy Alexander-Grout, chief executive at My VIP Card.

She told the FT: "People's confidence was hit once again and that translated very rapidly into reduced footfall on the high street."