Britain's economy shrank more at its sharpest rate in 30 years in the first three months of 2009, official data showed today, suggesting the recession may be deeper than feared.
The Office for National Statistics said gross domestic product fell 1.9 per cent on the quarter in the first three months of this year, the biggest fall since the third quarter of 1979 and below forecasts for a 1.5 per cent contraction.
Most analysts had expected the 1.6 per cent fall seen at the end of last year to mark the worst period of the recession.
On the year, GDP fell by 4.1 per cent, the biggest annual drop since the end of 1980. Analysts had expected a 3.8 per cent contraction.
The figures suggest there are downside risks to finance minister Alistair Darling's forecast for a 3.5 per cent contraction this year -- he had expected first quarter GDP figures to show a similar drop to the fourth quarter.
The latest data also suggest policymakers may need to do more to kick-start the economy, having already slashed interest rates to a record low of 0.5 per cent and started buying assets with newly created money.
The government has also pumped more than £20 billion into the economy.
The ONS data showed the biggest quarterly fall in manufacturing output since records began in 1948 and the biggest quarterly fall in services output since 1979.
Business services and finance recorded its biggest drop in output since records began in 1983.
Separate data showed an unexpected rise in retail sales on the month in March driven by strength in clothing and food sales.
Reuters