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- The Office for National Statistics shows Britain recorded a much bigger than expected current account deficit of 8.540 billion pounds in the first quarter.
City Desk
The UK economy has shrunk at its fastest rate since 1958 in the first three months of this year according to figures released showing the UK's GDP has fallen by 2.4 percent in the first quarter, the biggest decline since May 1958.
Economists around the world have said that the sharp decline in British economic growth is much worse than the 1.9 percent decline published last month, due to downward revisions to services and construction output.
Reuters is reporting that on the year the economy reported drops of a record 4.9 percent and output in previous quarters was revised down, meaning Britain's first recession since the early 1990s has been running longer and deeper than previously thought.
'You've never had it so bad' seems the most apt summary of the state of the UK economy in Q1," said Ross Walker, UK economist at RBS.
This has been a bad week for the government with the OECD giving a negative outlook on the UK economy by stating that "for the government to ensure its own forecasts retained credibility, it must specify where spending cuts would occur once the economy began to recover." The FT reported that "this would “require specifying the ‘value for money’ savings beyond 2011-12 in the upcoming spending review”, signaling a commitment to getting the public finances back on to a sustainable footing."
Lloyds Banking group also announced today that another 2,100 jobs were to go over the next three years as the part-nationalised lender continues to streamline the business following last year’s takeover of rival HBOS.
photo credit: London Daily News
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