UK Falls Deeper Into Recession
Figures released today have revealed that the state of the UKs economy is in worse condition than analysts had previously believed. National output within the construction industry has shrunk by 4.8% in the first quarter of the year according to the Office for National Statistics, which will lead to a number of problems for analysts and investors who had previously believed figures to be much better than projected today.
The importance of growth within the construction industry for the economy at large has been proclaimed by economists and politicians for a number of years now, and this news today comes as yet another blow to the UKs already gloomy financial outlook.
All sides of the industry are being affected by this lack of production. Paul Robinson, who owns a timber merchants in Liverpool said; “We’ve definitely seen a decline in sales in our area. The whole industry needs more investment to get it moving again. People still need homes – more so in fact today than ever. It’s a frustrating business to be in at the moment.”
As a result of this lack of output, analysts believe that more quantative easing is looking increasingly inevitable, and IMF chief Christine Lagarde has suggested cutting the Bank of England’s base rate from 0.5% to 0 in order to help the UK to climb out of the recession.
These problems have no doubt been bolstered by the increasing crisis in the Eurozone. In a statement, the ONS said, “Over the past eighteen months, the economy has experienced a mild contraction in ouput. This reflects global economic headwinds as well as domestic economic conditions such as the continuing high rates of inflation in the UK”