UK economy in double-dip recession

By BBC News

The UK economy has returned to recession, after shrinking by 0.2% in the first three months of 2012. A sharp fall in construction output was behind the surprise contraction, the Office for National Statistics said.

A recession is defined as two consecutive quarters of contraction. The economy shrank by 0.3% in the fourth quarter of 2011. BBC economics editor Stephanie Flanders says it “adds to the picture that the economy is bumping along the bottom”.

She said economic output was slightly smaller now than it was in the autumn of 2010.

Wednesday’s figure is an early estimate and is subject to at least two further revisions in the coming months. It is compiled using 40% of the data gathered for later revisions.

The UK economy was last in recession in 2009. Prime Minister David Cameron said the figures were “very, very disappointing”.

“I don’t seek to excuse them, I don’t seek to try to explain them away,” he said at Prime Minister’s Questions.

“There is no complacency at all in this government in dealing with what is a very tough situation, which frankly has just got tougher.”

He said it was “painstaking, difficult” work, but the government would stick with its plans and do “everything we can” to generate growth.

Labour leader Ed Miliband said the figures were “catastrophic” and asked Mr Cameron what his excuse was.

“This is a recession made by him and the chancellor in Downing Street. It is his catastrophic economic policy that has landed us back in recession,” Mr Miliband said.

Read More Here

Share.