June 30th, 2009 – 6:20 pm ICT by IANS
London, June 30 (IANS) The British economy shrank by 2.4 percent in the first quarter – the fastest rate of shrinkage in more than 50 years, according to official figures released Tuesday.
The Office for National Statistics (ONS) said the contraction between January and March was the fastest since 1958.
The ONS said construction output was revised down from -2.4 percent to -6.9 percent in the first quarter.
The services sectorof the British economy, accounting for more than two-thirds shrank by 1.6 percent and industrial output was down -5.1.
The ONS said the British recession started earlier than first thought last year – it began during the second quarter of 2008 rather than during July to September, so that the recession has now been running for a whole year.
Andrew Goodwin, senior economic advisor to the Ernst & Young Item Club, said “We had expected a downward revision to GDP, given the plunge in construction output since the last quarter, but the scale of revision comes as a real shock, and highlights the extreme weakness of the economy in the early months of the year,”
chief European economist at Capital Economics onathan Loynes, said, “The average GDP growth in 2009 now looks likely to be -4 per cent or weaker rather than the -3.5 per cent we previously expected,”