British Economy has Worst Quarter in 50 years

Bloomberg reports:

The U.K. economy shrank more than previously estimated in the first quarter in the biggest contraction since 1958 as the recession choked industries from construction to services.
Gross domestic product fell 2.4 percent from the final three months of 2008, compared with the prior measurement of a 1.9 percent drop, the Office for National Statistics said today in London. The median prediction in a Bloomberg survey of 28 economists was for a 2.1 percent decline. Construction activity plunged almost three times as much as originally estimated.
Bank of England Governor Mervyn King said last week that Britain’s recovery from recession may turn out to be “a long, hard slog.” While business surveys have indicated the economic slump is easing, unemployment may continue to increase and net mortgage lending is the weakest since records began in 1993.
“In big picture terms, it doesn’t really change the outlook,” said Nick Kounis, an economist at Fortis Bank Nederland Holding NV in Amsterdam and a former U.K. Treasury official. “The recovery is unlikely to be very strong any time soon. There’s more bad news for consumers ahead.”

The lousy economy is apparently affecting everyone: Queen to run out of funds by 2012.

Posted by on June 30th, 2009 at 9:43 am

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