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UK heads for triple dip as GDP contracts 0.3pc
UK GDP contracted by a bigger-than-expected 0.3pc in the last three months of 2012, bringing the economy closer to a triple dip recession.
The news will be a blow for George Osborne, who yesterday defended hits austerity programme against criticism from the IMF. Photo: EDDIE MULHOLLAND
9:34AM GMT 25 Jan 2013
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The Office for National Statistics said the fall was down to lower output from the North Sea and manufacturers.
The news will be a blow for Britain's Conservative-led government, which only a day earlier defended its austerity programme against criticism from the International Monetary Fund's chief economist.
The economy is now 3.3PC smaller than its peak in the first quarter in 2008, recovering only about half the output lost during the financial crisis - a worse performance than other major economies.
Britain's economy also suffered a mild recession from late 2011 to mid 2012.
"It confirms what we already knew - that Britain, like many European countries, still faces a very difficult economic situation," the Treasury said in a statement.
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"While the economy is healing, it is a difficult road."
The biggest driver for the fall in GDP was a 10.2pc quarterly drop in mining and quarrying output, the biggest since records began in 1997, driven by disruption to North Sea oil and gas fields.
This knocked 0.18pc off of GDP, while falls in factory output and in the 'government and other services' category, where the London Olympics had boosted sports and recreation services in the third quarter.
At the start of 2013 one-off factors, such as January's snow, may push the economy into an unprecedented triple-dip recession, with major retailer John Lewis already warning on Friday that snow had hit sales growth.
Sir Mervyn King, the Bank of England Governnor, expects no more than a "gentle recovery" this year, while this week the International Monetary Fund cut its 2013 forecast for British economic growth to 1pc from 1.1pc predicted in October.
However, even such lacklustre growth could be derailed, as some analysts and business groups warn, by a hit to firms' and consumers' confidence from talk of a triple-dip recession.
That will add to pressure on the Coalition rto loosen its austerity drive and bolster the economy.
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UK GDP contracted by a bigger-than-expected 0.3pc in the last three months of 2012, bringing the economy closer to a triple dip recession.
The news will be a blow for George Osborne, who yesterday defended hits austerity programme against criticism from the IMF. Photo: EDDIE MULHOLLAND9:34AM GMT 25 Jan 2013
52 Comments The Office for National Statistics said the fall was down to lower output from the North Sea and manufacturers.
The news will be a blow for Britain's Conservative-led government, which only a day earlier defended its austerity programme against criticism from the International Monetary Fund's chief economist.
The economy is now 3.3PC smaller than its peak in the first quarter in 2008, recovering only about half the output lost during the financial crisis - a worse performance than other major economies.
Britain's economy also suffered a mild recession from late 2011 to mid 2012.
"It confirms what we already knew - that Britain, like many European countries, still faces a very difficult economic situation," the Treasury said in a statement.
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19 Jan 2013
"While the economy is healing, it is a difficult road."
The biggest driver for the fall in GDP was a 10.2pc quarterly drop in mining and quarrying output, the biggest since records began in 1997, driven by disruption to North Sea oil and gas fields.
This knocked 0.18pc off of GDP, while falls in factory output and in the 'government and other services' category, where the London Olympics had boosted sports and recreation services in the third quarter.
At the start of 2013 one-off factors, such as January's snow, may push the economy into an unprecedented triple-dip recession, with major retailer John Lewis already warning on Friday that snow had hit sales growth.
Sir Mervyn King, the Bank of England Governnor, expects no more than a "gentle recovery" this year, while this week the International Monetary Fund cut its 2013 forecast for British economic growth to 1pc from 1.1pc predicted in October.
However, even such lacklustre growth could be derailed, as some analysts and business groups warn, by a hit to firms' and consumers' confidence from talk of a triple-dip recession.
That will add to pressure on the Coalition rto loosen its austerity drive and bolster the economy.
Ho Ho Ho
Mega
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