A boarded up pub in central London is symbolic of the depression that has descended on the dominant services sector

The economy is collapsing under the strain of the coronavirus crisis with activity in the dominant services sector tumbling in March, according to a closely watched survey.

Economists are bracing themselves for a “recession of unprecedented scale and depth” as government shutdowns have brought large parts of the key services sector in Britain and Europe to a standstill.

IHS Markit’s purchasing managers’ index for the UK fell to 34.5 from 53.2 in March, even weaker than an initial flash estimate of 35.7 and the fastest decline since the survey began in 1996. Any reading below 50 signals contraction.

Sterling fell sharply yesterday after the PMI figures were published, dropping by 1.3 per cent against the dollar to $1.223 and 0.7 per cent against the euro