The UK economy shrank by the most in more than half a century in the first three months of the year, according to revised figures which were much weaker than originally estimated.
The 2.4 per cent decline in gross domestic product was sharper than the 1.9 per cent initially calculated, the Office for National Statistics reported, and was greater than the 2.1 per cent fall expected by economists. About half the revision was due to the introduction of new construction sector data and the rest was bacause of more complete services sector figures showing a sharper decline.
Not since 1958 has the quarter-on-quarter decline in GDP been greater, while the 4.9 per cent drop compared to a year earlier was the largest since records began in 1948.
“‘You’ve never had it so bad’ seems the most apt summary of the state of the UK economy in Q1,” said Ross Walker, economist at RBS. “Although to some extent this is ‘old news’, it does serve to emphasise the size of the hole out of which the UK must climb.”
The precipitous decline in GDP in the first quarter reflected the fallout after the credit crisis escalated dramatically from September of last year onwards and highlights the depth of the recession that the UK has been suffering.
But since the end of the first quarter there have been growing signs that the economy is stabilising. Manufacturing output actually grew in March and April, while survey data suggested the economy has returned to growth.The respected economics thinktank, the National Institute for Economic and Social Research, said it thought the economy began to grow again in April.
“The survey data suggest we have at least stopped digging, but the economy remains on course for a lacklustre pace of recovery,” Mr Walker said.
The Bank of England has warned that the economy faces a slow recovery, as banks remain fragile and lending weak.
The output of the construction was revised down to show a 6.9 per cent decline from the first estimate of a 2.4 per cent drop. However, the fall in output was actually less severe than the 9 per cent fall that a more recent ONS revision had suggested, which had led many to expect GDP to be revised down sharply.
Services output, which makes up about three quarters of the UK economy, was revised down to see a drop of 1.6 per cent rather than the 1.2 per cent orginally reported.
“Revisions to GDP are larger than usual, reflecting greater uncertainty in measurement during a period of rapid change in economic activity,” the ONS said.
The GDP figures confirmed that the recession began in the second quarter of last year, after the economy shrank by 0.1 per cent in the April to June period, rather than the 0.0 per cent decline originally reported.
The economy contracted by 4.9 per cent from its peak in the first quarter until the first quarter this year. That is worse than the 2.5 per cent drop in the 1990s recession, but less than the 5.9 per cent fall in the early 1980s recession.
Despite the dramatic contraction in the economy rating agency Fitch reconfirmed the top triple-A rating on the UK’s sovereign debt at stable - along with the US, France and Germany - refusing to follow rival Standard & Poor’s which recently changed the UK’s debt outlook to negative.
The household saving ratio fell to 3 per cent from 4 per cent in the final quarter of last year, as households’ real disposable income dropped by 2.4 per cent due to lower earnings, but consumption did not fall as sharply.
Business investment fell by 7.1 per cent during the quarter. Inventories made a smaller drag of 0.4 percentage points out of the 2.4 per cent fall in GDP, compared to the previous estimate of 0.6 percentage points.
“The UK national accounts … underline the fact that the economic recovery is built on very fragile foundations,” said Capital Economics.
“With the annual rate pulled down from -4.1 per cent to -4.9 per cent, average GDP growth in 2009 now looks likely to be -4 per cent or weaker rather than the -3.5 per cent we previously expected.
“Note too that the breakdown is not pretty, with the renewed fall in the household saving ratio from 4 per cent to 3 per cent underlining that the adjustment in the household sector has a long way yet to go.”
Awesome site…
[...] one of our readers recently recommended the following websites [...]…
Net minicab…
Oxshott Taxi!…
News info…
I was reading the news and I saw this really interesting information…
Hello…..
Thanks for sharing superb informations. Your web-site is very cool. I’m impressed by the details that you’ve on this website. It reveals how nicely you understand this subject. Bookmarked this website page, will come back for more articles. You, my f…
Hiya…..
Nice read, I just passed this onto a colleague who was doing some research on that. And he just bought me lunch because I found it for him smile So let me rephrase that: Thank you for lunch! “Creativity comes from zeal to do something, generally it is…
Check this out…
[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……
Gems form the internet…
[...]very few websites that happen to be detailed below, from our point of view are undoubtedly well worth checking out[...]……
btjunkie download…
[...]below you’ll find the link to some sites that we think you should visit btjunkie download[...]……
Hello…
You are my inhalation , I possess few web logs and very sporadically run out from to post . …
frostwire free download…
[...]The information mentioned in the article are some of the best available frostwire free download[...]……
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
Visitor recommendations…
[...]one of our visitors recently recommended the following website[...]……
Great information…
This is magnificent. Type checked out every comprise therefore we are flabbergasted. We’re interested in this type of activities. United states appreciate a rising place, and charge the effort in this. Please keep enhancing. They may be astonishingly …
Hi…
Simply a smiling visitant here to share the love (:, btw great style and design ….
[...]the time to read or visit the content or sites we have linked to below the[...]……
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
torrent pirate bay…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out torrent pirate bay[...]……
isohunt music download…
[...]here are some links to sites that we link to because we think they are worth visiting isohunt music download[...]……
nero free…
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over nero free[...]……
download bearshare…
[...]usually posts some very interesting stuff like this. If you’re new to this site download bearshare[...]……
free microsoft points…
[...]Sites of interest we have a link to free microsoft points[...]……
io…
This is a terrific web page, would you be involved in doing an interview regarding just how you designed it? If so e-mail me!…
Gems form the internet…
[...]very few websites that happen to be detailed below, from our point of view are undoubtedly well worth checking out[...]……
Blogs to read…
[...] Here is an awesome blog you can definitely find interesting that we suggest you [...]…
Blogs to check…
[...] Nearly every now and again we go with blogs that we read through. Listed below are the most recent sites that we consider [...]…
Hiya…..
Excellent read, I just passed this onto a colleague who was doing some research on that. And he just bought me lunch as I found it for him smile Therefore let me rephrase that: Thanks for lunch! “Creativity comes from zeal to do something, generally i…
Hey……
I have recently started a web site, the info you provide on this site has helped me greatly. Thank you for all of your time & work. “It is no use saying, ‘We are doing our best.’ You have got to succeed in doing what is necessary.” by Sir Winston C…
Hi…..
I’ve recently started a site, the information you offer on this website has helped me tremendously. Thanks for all of your time & work. “It is no use saying, ‘We are doing our best.’ You have got to succeed in doing what is necessary.” by Sir Wins…
ares free download…
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose ares free download[...]……
You should check this out…
[...] often a big fanatic of backlinking to bloggers that I like but are rarely getting a lot of link love by means of [...]…
You should check this out…
[...] Wonderful story, reckoned we could combine a few unrelated data, nevertheless really worth taking a look, whoa did one learn about Mid East has got more problerms as well [...]……
toronto escorts…
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose toronto escorts [...]……
Read was interesting, stay in touch…
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]…
Recent Blogroll Additions……
[...] one among our visitors fairly recently recommended the following website [...]…
Hmm…..
Great write-up, I am regular visitor of one’s site, maintain up the excellent operate, and It is going to be a regular visitor for a lengthy time. “He who seizes the right moment is the right man.” by Johann von Goethe….
Best additions…
[...] yet still deliberating with an actual specific fashion that you inspired who [...]…
Great post…
I would like to thank you for the efforts you have put in writing this web site. I am hoping the same high-grade web site post from you in the future as well. Actually your creative writing abilities has inspired me to get my own web site going now. Re…
vlc media player…
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose vlc media player [...]……
frostwire download…
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose frostwire download [...]……
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
download audacity…
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose download audacity [...]……
Cool sites…
[...]we came across a superb site that you might enjoy. Take a look if you want[...]……
Having problem with frontal hair loss?…
Discover proven and effective frontal hair loss treatment that works now!…
asklover…
[...]The info mentioned inside the write-up are several of the top accessible [...]…
Cool sites…
[...]we came across a cool site that you might enjoy. Take a look if you want[...]……
Links…
[...]Sites of interest we have a link to[...]……
SEO discount…
I told my mother to check out this site. Thanks for sharing….
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
Trackbacks…
[...] not very many sites that happen to be listed below, from our own viewpoint are without any doubt well worth going over [...]…
Hiya…..
Excellent read, I just passed this onto a friend who was doing some research on that. And he actually bought me lunch as I found it for him smile So let me rephrase that: Thank you for lunch! “We strain to renew our capacity for wonder, to shock ourse…
Hi…..
I’ve recently started a blog, the information you provide on this web site has helped me greatly. Thanks for all of your time & work. “It is no use saying, ‘We are doing our best.’ You have got to succeed in doing what is necessary.” by Sir Winsto…