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| Version 2 | Version 3 |
|---|---|
| Data set to confirm UK recession | Data set to confirm UK recession |
| (10 minutes later) | |
| Official output data is expected to confirm the UK is in a recession later - in line with what economists have been saying for months. | Official output data is expected to confirm the UK is in a recession later - in line with what economists have been saying for months. |
| The figures are forecast to show the UK has experienced two consecutive quarters of negative economic growth. | The figures are forecast to show the UK has experienced two consecutive quarters of negative economic growth. |
| Gross domestic product is predicted to have fallen by 1.2% in 2008's final quarter, following on from a 0.6% contraction in the previous quarter. | Gross domestic product is predicted to have fallen by 1.2% in 2008's final quarter, following on from a 0.6% contraction in the previous quarter. |
| This would represent the biggest decline since 1990's third-quarter. | This would represent the biggest decline since 1990's third-quarter. |
| If the consensus is right, the figure will also represent a 1.4% decline on the same quarter a year ago - the biggest year-on-year fall since 1991. | If the consensus is right, the figure will also represent a 1.4% decline on the same quarter a year ago - the biggest year-on-year fall since 1991. |
| 'Grim figures' | 'Grim figures' |
| "A sharp fall in manufacturing output - down 3% in November alone - has led to fears that the decline in total GDP in the fourth quarter will exceed the 1% fall previously pencilled in by analysts," said Andrew Smith, chief economist at KPMG. | "A sharp fall in manufacturing output - down 3% in November alone - has led to fears that the decline in total GDP in the fourth quarter will exceed the 1% fall previously pencilled in by analysts," said Andrew Smith, chief economist at KPMG. |
| What started as a crisis in the financial sector continues to infect the wider economy. | What started as a crisis in the financial sector continues to infect the wider economy. |
| RECORD QUARTERS Biggest post-war quarterly decline was -2.6% in Q2 1958Largest drop in one quarter over previous year was -4.1% in Q4 1980Worst fall in one quarter on previous year in 1990s recession was -2.2% in Q2 1991 | RECORD QUARTERS Biggest post-war quarterly decline was -2.6% in Q2 1958Largest drop in one quarter over previous year was -4.1% in Q4 1980Worst fall in one quarter on previous year in 1990s recession was -2.2% in Q2 1991 |
| Unemployment is accelerating sharply, with 1.92 million people now out of work, the housing market remains severely depressed and retail sales are weak. | Unemployment is accelerating sharply, with 1.92 million people now out of work, the housing market remains severely depressed and retail sales are weak. |
| "It is difficult to see why things should improve in the foreseeable future," Mr Smith said. | |
| Neil Mackinnon, chief economist at ECU Group, said: "There are no green shoots of recovery, no light at the end of the tunnel and the GDP figures will be grim and underscore the depth of the recession." | Neil Mackinnon, chief economist at ECU Group, said: "There are no green shoots of recovery, no light at the end of the tunnel and the GDP figures will be grim and underscore the depth of the recession." |
| The average recession in the UK since 1955 has lasted three quarters, but the past two recessions have lasted for five. | The average recession in the UK since 1955 has lasted three quarters, but the past two recessions have lasted for five. |
| In fact, many forecasters believe a recession could stretch into 2010 and be as severe as that of the early 1990s. | In fact, many forecasters believe a recession could stretch into 2010 and be as severe as that of the early 1990s. |
| Deteriorating picture | Deteriorating picture |
| GDP is the most commonly used indicator of national income. | GDP is the most commonly used indicator of national income. |
| It attempts to measure the sum of incomes received by the various wealth-creating sectors of the economy, from manufacturing and retail to agriculture and service industries. | It attempts to measure the sum of incomes received by the various wealth-creating sectors of the economy, from manufacturing and retail to agriculture and service industries. |
| The consensus forecast for 2009 as a whole is now for a 2.1% decline in GDP. | The consensus forecast for 2009 as a whole is now for a 2.1% decline in GDP. |
| As recently as December, the forecast was for a drop of 1.5%. | As recently as December, the forecast was for a drop of 1.5%. |
| This highlights the rapidly deteriorating economic picture over recent weeks, during which a number of the UK's best known high street retailers, such as Woolworths and Zavvi, have gone into administration. | This highlights the rapidly deteriorating economic picture over recent weeks, during which a number of the UK's best known high street retailers, such as Woolworths and Zavvi, have gone into administration. |
| The pound has slumped against the euro and many analysts believe that parity is now inevitable. Sterling also hit a seven-year low against the dollar this week. | The pound has slumped against the euro and many analysts believe that parity is now inevitable. Sterling also hit a seven-year low against the dollar this week. |
| International investors are said to be losing confidence in the UK economy and the government's attempts to kick-start lending from the banks. | International investors are said to be losing confidence in the UK economy and the government's attempts to kick-start lending from the banks. |
| The official government forecast is for a decline of 0.75% to 1.25% in 2009, although the Chancellor Alistair Darling has indicated that he will revising this figure in the Budget. | The official government forecast is for a decline of 0.75% to 1.25% in 2009, although the Chancellor Alistair Darling has indicated that he will revising this figure in the Budget. |