UK Q2 economic growth ground to a halt
Sunday, 24 August 2008

AP, LONDON  -- British economic growth ground to a halt between April and June, ending more than 15 years of continuous expansion, the government said Friday, as many fear the country is headed for recession.

The growth figure of 0.0 percent is below even the modest 0.2 percent that the Office for National Statistics had predicted.
 
It ends a run of 63 consecutive quarters -- nearly 16 years -- of growth since the April to June period of 1992, when Britain's gross domestic product shrank.
 
The figures are the strongest indicator yet -- amid a crashing housing market, falling consumer confidence and inflation running at double government targets -- that Britain is teetering on the brink of a recession.
 
Economists say that preliminary data shows that the British economy is performing even worse now than it did in the second quarter, meaning that GDP shrinkage is likely to be recorded in the upcoming July to September quarter.
 
''We've entered a period of quite acute weakness that's unlikely to be short-lived,'' said Jonathan Loyns, chief European economist at Capital Economics. ''There's a good chance we're facing at least two consecutive quarters of negative growth.'' Two quarters of contraction is one common definition of a recession.
 
In the midst of the worst housing crash for 30 years, Britain's construction industry has been hit the hardest, the national statistics office said, with construction output falling 1.1 percent.
 
Meanwhile, manufacturing output fell by 0.8 percent, according to the government figures. That confirms a survey published by the Chartered Institute of Purchasing and Supply earlier this month showing that the Britain's manufacturing activity declined by the most in almost a decade in July.

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