UK Q4 economic growth figures revised downwards

| February 25, 2011 | 0 Comments

The Office for National Statistics (ONS) has today revealed the UK economy contracted by 0.6% in the October to December period - slightly worse than the first estimate of 0.5%.

Economists had expected the figures to remain unchanged.

Today’s estimate is the second reading, a third and final estimate will be available next month.

However, bad weather has been attributed to the poor growth figures.

The economic figures compare dismally to other countries. Germany and France posted growth of 0.4% and 0.3% respectively in the fourth quarter.

Today’s figures, however, will continue to present the Bank of England’s Monetary Policy Committee with a dilemma.

Despite pressure to lift interest rates to combat stubbornly high inflation, the central bank will be reluctant at this stage to lift interest rates when the recovery is losing momentum.

However, while there have been fears of a double-dip recession, most analysts believe the economy will recover in the first quarter of the year.

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