A strong economic recovery following the coronavirus pandemic is likely although many risks and uncertainties remain, according to a report from Oxford Economics.
The report, which was commissioned by the ICAEW, predicts that the economy should return to growth in the second half of the year if the lockdown continues to be relaxed over the summer.
It says the unusual nature of this recession could prove to be a silver lining for the recovery. Because GDP has fallen due to a planned, partial economic shutdown, so in theory activity and demand should rebound as restrictions lift.
The fiscal and monetary support from government and the Bank of England since the crisis began should also aid the recovery.
However, the risks remain high as a second wave of infections, an extension to the lockdown, the early withdrawal of government support or the collapse of UK-EU trade talks could all hamper a recovery.
Commenting on the report, Martin Beck, Oxford Economics Lead UK Economist, said: 'Coronavirus and the restrictions on daily life imposed in response are inflicting a once-in-a-century downturn on the economy.
'But the nature of the shock and the massive support put in place by policymakers mean a strong bounce back is achievable. However, with no precedents to draw on, the outlook is clouded by multiple risks.'