It coincided with four weeks of restrictions across much of the country.

The 2.6% monthly decline was much smaller than most analysts expected, though a Reuters poll had pointed to contraction of more than double that the downturn was led by the services sector as pubs, restaurants and non essential shops had to shut.

Economists are warning that Britain will likely suffer a double dip recession.

Its economy shrank more sharply than any other major advanced economy in the first half of 2020 and it's now 8.5% smaller than before the start of the pandemic.

Finance Minister Richie Cernak said Friday's figures highlight the challenges ahead, but added that the rollout of vaccines in Britain, which has been faster than elsewhere in Europe, was reason to be hopeful.

Several economists, though, say the economy will likely shrink in the first three months of 2021 thanks to a third tougher locked down now in place.

The UK is also facing a less open trading relationship with the European Union, which could put further pressure on business.

Bank of England Governor Andrew Bailey said this week that it was too soon to say if further stimulus would be needed.

The central bank ramped up its bond buying program toe over $1.2 trillion in November.