There’s no cheering corners in this news. One economist sees “no
green shoots of recovery, no light at the end of the tunnel”
~Another says "It is difficult to see why things should improve in
the foreseeable future,”, and the BBC’s economics editor ventures
"These figures suggest that it's not going to be done by
Christmas," {2009, she means, I hope! -cs]
Since this represents facts for the record I’ll send it out
separately . There’ll be comment enough later.
xxxxxxxxxxxxxx cs
========================
BBC ONLINE 23.1.09
UK in recession as economy slides
The UK is now in recession for the first time since 1991, official
government figures have confirmed.
Gross domestic product fell by 1.5% in the last three months of 2008
after a 0.6% drop in the previous quarter.
That means that the widely accepted definition of a recession - two
consecutive quarters of falling economic growth - has been met.
It represents the biggest quarter-on-quarter decline since 1980, and
a 1.8% fall on the same quarter a year ago.
The worse-than-expected contraction sent sterling to a 24-year low
against the dollar, with one pound buying $1.3612.
Meanwhile the FTSE 100 index fell almost 2%, below 4,000 points.
'Broad-based decline'
The figures, from the Office for National Statistics (ONS), showed
that manufacturing made the largest contribution to the slowdown,
contracting by 4.6% after a 1.6% per cent decrease in the previous
quarter.
However almost all elements of the economy shrank, the ONS said.
The fall in GDP was slightly steeper than most analysts had been
expecting, said the BBC's economics editor Stephanie Flanders
"These figures suggest that it's not going to be done by Christmas,"
she said.
The downturn was "broad-based" our economics editor added, saying
that the bleak manufacturing data ended "any prospect of this being a
white-collar recession that would largely escape manufacturers ".
'Grim'
What started as a crisis in the financial sector continues to infect
the wider economy.
Unemployment is accelerating sharply, with 1.92 million people now
out of work, the housing market remains severely depressed and retail
sales are weak.
And though December's retail figures were better than expected,
growing by 1.6%, this was driven by heavy discounting and should be
treated "with caution" the ONS said.
"It is difficult to see why things should improve in the foreseeable
future," said Andrew Smith, chief economist at KPMG.
Neil Mackinnon, chief economist at ECU Group, said the GDP figures
were "grim" and underscored the depth of the recession.
"There are no green shoots of recovery, no light at the end of the
tunnel," he added.
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.
Deteriorating picture
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.
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%.
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.
As well as its low against the dollar, the pound has slumped against
the euro and many analysts believe that parity is now inevitable.
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 the economy to shrink between
0.75% and 1.25% in 2009, although the Chancellor Alistair Darling has
indicated that he will revise this figure in the Budget.
green shoots of recovery, no light at the end of the tunnel”
~Another says "It is difficult to see why things should improve in
the foreseeable future,”, and the BBC’s economics editor ventures
"These figures suggest that it's not going to be done by
Christmas," {2009, she means, I hope! -cs]
Since this represents facts for the record I’ll send it out
separately . There’ll be comment enough later.
xxxxxxxxxxxxxx cs
========================
BBC ONLINE 23.1.09
UK in recession as economy slides
The UK is now in recession for the first time since 1991, official
government figures have confirmed.
Gross domestic product fell by 1.5% in the last three months of 2008
after a 0.6% drop in the previous quarter.
That means that the widely accepted definition of a recession - two
consecutive quarters of falling economic growth - has been met.
It represents the biggest quarter-on-quarter decline since 1980, and
a 1.8% fall on the same quarter a year ago.
The worse-than-expected contraction sent sterling to a 24-year low
against the dollar, with one pound buying $1.3612.
Meanwhile the FTSE 100 index fell almost 2%, below 4,000 points.
'Broad-based decline'
The figures, from the Office for National Statistics (ONS), showed
that manufacturing made the largest contribution to the slowdown,
contracting by 4.6% after a 1.6% per cent decrease in the previous
quarter.
However almost all elements of the economy shrank, the ONS said.
The fall in GDP was slightly steeper than most analysts had been
expecting, said the BBC's economics editor Stephanie Flanders
"These figures suggest that it's not going to be done by Christmas,"
she said.
The downturn was "broad-based" our economics editor added, saying
that the bleak manufacturing data ended "any prospect of this being a
white-collar recession that would largely escape manufacturers ".
'Grim'
What started as a crisis in the financial sector continues to infect
the wider economy.
Unemployment is accelerating sharply, with 1.92 million people now
out of work, the housing market remains severely depressed and retail
sales are weak.
And though December's retail figures were better than expected,
growing by 1.6%, this was driven by heavy discounting and should be
treated "with caution" the ONS said.
"It is difficult to see why things should improve in the foreseeable
future," said Andrew Smith, chief economist at KPMG.
Neil Mackinnon, chief economist at ECU Group, said the GDP figures
were "grim" and underscored the depth of the recession.
"There are no green shoots of recovery, no light at the end of the
tunnel," he added.
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.
Deteriorating picture
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.
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%.
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.
As well as its low against the dollar, the pound has slumped against
the euro and many analysts believe that parity is now inevitable.
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 the economy to shrink between
0.75% and 1.25% in 2009, although the Chancellor Alistair Darling has
indicated that he will revise this figure in the Budget.
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