According to recent figures available from the Office for National Statistics (ONS),
UK economy registered a drop of 2.4 per cent in the first quarter. This rate of fall is the fastest rate in over 50 years.

Latest ONS figures reveal that between January and March 2009, the economy shrunk by its fastest pace since 1958. Their initial estimate was contraction of only 1.9 per cent.

Estimates of construction output was revised down from minus 2.4 per cent to minus 6.9 per cent in the first quarter, but there was also a bigger than expected drop in output from the services sector, that accounts for more than two thirds of the economy, which was revised down from 1.2 per cent to 1.6 per cent.


Industrial output was revised up slightly to -5.1 per cent, from the initial estimate of -5.3 per cent.

Analysts said that the figures underlined the fragility of the economy, with some revising down their expectations for economic growth this year as a result.

The data also showed GDP fell in the second quarter of 2008, meaning the recession started earlier than was initially thought. The country has now been in recession for a full year.

Experts predict that the UK economy will shrink by 3.5 per cent this year but will return to growth, of around 1.25 per cent, next year and in subsequent periods.


The OECD is also predicting that UK unemployment will top 3 million over the next 12 months

According to the ONS, year on year, GDP had fallen 4.9 per cent, the biggest drop on record. It had previously estimated a fall of 4.1 per cent.

The revised figures sent sterling down to around $1.6605 against the dollar.

However, there is some good news of the UK house prices getting stabilized. House prices rose by 0.9 per cent in June, according to the Nationwide Building.

The average house price in June stood at £156,442, compared with £154,016 in the previous month.

While the monthly rise of 0.9 per cent is below the 1.3 per cent increase in prices for May, the measure of growth over three months revealed the first rise since December 2007.