THE UK economy recorded its sharpest decline in more than 50 years during the first quarter of 2009, figures showed last night.
And revisions to figures revealed the current recession began earlier than first thought, with a 0.1% decline seen between April and June last year, compared with previous estimates of zero growth.
Output fell 2.4% in the first three months of the year – the fastest rate since 1958, the Office for National Statistics (ONS) said.
The economy also showed an annual decline of 4.9% – the biggest fall since ONS records began in 1948.
The first-quarter decline of 2.4% is much worse than the 1.9% first estimated and comes after bigger-than-expected falls in construction and the UK’s key services sector.
The plummet in activity between January and March was almost equal to the 2.5% fall suffered during the whole of the recession in the 1990s, Investec’s David Page said.
He warned: “The economy is now likely to undergo a peak to trough adjustment in excess of 5%, nearly as big as the overall 5.9% collapse seen from 1979-1981.”
The scale of the decline could put pressure on Chancellor Alistair Darling’s forecasts for the public finances this year.
But Chief Secretary to the Treasury Liam Byrne said the figures were “historic”, reflecting the state of the economy months earlier.
