UK double dip recession revised away, but picture still grim

LONDON (Reuters) - Britain's economy did not suffer a double-dip recession after all, but its recession immediately after the financial crisis was deeper than previously thought.

Revised data showed that Britain's economy did not shrink in the first three months of 2012, and output was instead flat, the Office for National Statistics said following a major annual revision of Britain's economic data.

That meant that the country did not suffer the two consecutive quarters on contraction which commonly define a recession - a relief for Chancellor George Osborne, even if other revisions showed a darker underlying picture.

Britain's economy shrank by 7.2 percent in recession immediately after the financial crisis, compared to earlier estimates of a 6.3 percent decline.

Output is now 3.9 percent below its pre-recession peak, again worse than previously reported.

Growth in the first three months of 2013 was unrevised at 0.3 percent compared with the previous quarter, but the year-on-year growth estimate was unexpectedly halved to 0.3 percent.

Britons' disposable incomes slumped by 1.7 percent on the quarter, their biggest fall since 1987, and business investment also fell sharply.

However, recent data and surveys point to a strengthening of growth in the second quarter, with the Bank of England forecasting a 0.5 percent expansion.

However, the economy remains fragile and many economists expect the central bank to restart its quantitative easing asset purchases of provide other stimulus soon after former Canadian central bank chief takes Mark Carney takes over from governor Mervyn King on July 1.

The ONS also released first-quarter current account data, which showed that Britain's deficit with the rest of the world widened unexpectedly.

(Reporting by William Schomberg and David Milliken)

Source: http://news.yahoo.com/uk-double-dip-recession-revised-away-picture-still-083435051.html

Google News Pray For Boston Anne Frank What Happened In Boston gold price defiance BBC