Double Dip: Britain Back In Recession, Say OECD Forecasters

Huffington Post UK  |  By Posted: 29/03/2012 10:54 Updated: 29/03/2012 11:24

Osborne
Chancellor George Osborne

Britain is likely to be back in a recession, according to international forecasters.

A recession is typically defined as two successive quarters of negative economic growth.

The Organisation for Economic Co-operation and Development (OECD) said GDP - a broad measure for the total economy - is on course to have fallen by about 0.1% in the three months to the end of March.

The OECD also warned the recovery for the world's biggest economies would be fragile, with the outlook for Europe "very weak".

In its latest interim assessment of the global economy the OECD estimated the UK economy experienced an annualised retraction of 1.2% in the last quarter of 2011 and of 0.4% in the first quarter of 2012.

It also predicted the economy would grow by 0.5% in the second quarter of 2012.

But that remains well below the G7 average, predicted to be around 1.9% growth in the second quarter of 2012 - with the US estimated to grow at 2.8%, Canada at 2.5% and Germany by 1.5%.

On Wednesday the Office of National Statistics said the UK economy shrank by more than previously thought in the final quarter of 2011.

GDP declined by 0.3%, the Office for National Statistics (ONS) said, downwardly revised from previous estimates of 0.2%.

The ONS said there had been a slight decline in the powerhouse services sector, which had initially thought to have been flat, while household spending was also worse than previously thought.

Other analysts predicted the UK economy would grow in the first quarter.

Vicky Redwood, chief UK economist at Capital Economics, told the Guardian: "It looks as though the economy has managed to expand in Q1.

"Nonetheless, we still think that there are a number of reasons to doubt that the recovery can maintain the recent acceleration."

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