Think tank sees Q4 growth of 0.4%

Leading economic think tank, the National Institute of Economic and Social Research (NIESR), believes the UK economy exited recession in the fourth quarter of 2009 and has experienced growth of 0.3%.

The prediction echoes many other reports forecasting that the economy has finally emerged from its worst recession in decades.

The UK economy, which has now contracted for six consecutive quarters, has been lagging behind other economies and is now the last major economy that is still in recession.

Official figures on 26 January will confirm whether the economy saw positive growth in the fourth quarter.

Meanwhile, returning to the NIESR, it believes GDP fell by 4.8% in 2009. “This is a bigger fall than in any year of the Great Depression and is Britain’s biggest contraction since 1921,” it said.

“The broader picture of the depression is that output fell sharply for twelve months until March and has not changed very much since then, although evidence of a recovery is starting to emerge,” added the NIESR.

There have been a number of positive economic reports this week with the Office for National Statistics (ONS) yesterday announcing a rise in UK industrial production for the month of November.

The official data showed that output rose by 0.4% in November compared with October and was slightly higher than analysts expectations of a 0.3% rise.

Earlier this week, the British Retail Consortium (BRC) announced that the High Street experienced the strongest December for eight years.

According to the BRC, like-for-like sales grew 4.2% by value during December as last-minute Christmas shoppers boosted sales.

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