UK recession: Figures confirm downturn

London, Jan.23 (ANI): Figures published on Friday provide official confirmation that Britain is in recession for the first time since the early 1990s. The Telegraph quotes analysts as saying that they expect the economy to have shrunk a dramatic 1.2 percent in the final three months of 2008, after contracting 0.6 percent in the third quarter of 2008.

A collapse in house prices and an unprecedented crisis in the banking sector has driven the economy into what many experts now predict will be the worst recession since World War Two, and left Prime Minister Gordon Brown trailing in opinion polls.

This is Britain's eighth recession since 1945, and no one knows how long it will last.

The Government on Monday announced a second bail-out for the country's battered banking sector as it desperately steps up efforts to get lenders lending again and consumers and businesses spending.

The sustained deterioration in economic data means "official forecasts of a relatively shallow and short-lived downturn, " said KPMG chief economist Andrew Smith.

The latest bulletins from the economy show little sign of improvement.

Manufacturers' expect the first quarter of 2009 to be the gloomiest in at least 50 years.

Economists also expect this current downturn to drive unemployment to levels not seen since at least the 1980s. Unemployment rose by 131,000 in the three months to November to reach 1.92 million - the highest level since September 1997. (ANI)