Tuesday, September 2, 2008
The UK economy is likely to fall into recession this year, according to the Organisation for Economic Cooperation and Development (OECD).
The Paris-based think tank predicts that the UK economy will shrink at an annual rate of 0.3% in the third quarter, and by 0.4% in the fourth.
According to the latest official figures, the UK economy did not grow at all in the second quarter of 2008.
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The working definition of a recession is two quarters of negative growth.
The gloomy outlook for the UK economy has pushed the pound sterling to its lowest level for two years against the euro.
The OECD forecast is the gloomiest yet for the UK economy by an official organisation, even gloomier than the forecast released by the International Monetary Fund (IMF) one month ago.
In its latest report, the OECD says that the UK economy will grow by just 1.2% for the whole of 2008, a sharp reduction in its earlier forecast of 1.8% made just two months ago, and less than the 1.4% predicted by the IMF.
This article was posted: Tuesday, September 2, 2008 at 11:26 am