GDP fell by 0.3% in the last quarter of 2011, lower than the initial estimate of 0.2%, official statistics showed on Wednesday.

The Office for National Statistics found for the whole of last year the UK's gross domestic product (GDP) grew by 0.7%.

The drop in the final quarter of 2011 was the first time GDP has fallen since the final quarter of 2010 when the Arctic weather was blamed for a 0.5% decline.

Azad Zangana, Economist at Schroders said the data suggested "weaker momentum" in 2012 and we could be heading for a recession, where growth contracts in two consecutive quarters.

"Growth for 2011 as a whole is now 0.7% rather than the previous estimate of 0.9%. Our view is that the weakness highlighted in this release in combination with the poor production and retail sales data so far for, it is more likely than not that the economy also contracted in the first three months of this year, which would put the UK in a technical recession."

But Jeremy Cook, Chief Economist at World First foreign exchange said the revision down was "slight blip".

“Even though this figure has been revised lower, we do however believe that we can now attribute this to being a slight blip.

"Business surveys such as the recent Purchasing Manager surveys have shown that Q1 should be growing at around a 0.3/0.4% pace, although we would like to see more in the form of business investment, which fell in Q4 by 3.3%. Hopefully the recent Budget will give that a prod in the right direction.

“The UK growth profile looks to continue to “bump along the bottom” in 2012 with no single quarter expected by us to print over 0.5%."