The net economic effect of Omicron – a blow to social consumption but a boost to health output from testing and vaccinations – resulted in only a modest 0.2% fall in GDP in December.
What you will learn:
- Retail and hospitality, two parts of the economy particularly exposed to greater consumer hesitancy in the face of rising infections, made the biggest contributions to the drop in GDP.
- Timelier high-frequency data have pointed to social consumption activity rebounding in recent weeks.
- But as one headwind recedes, growing cost of living pressures will weigh on growth this year.