UK recession deeper than forecast

Britains' chancellor of exchequer Alistair Darling believes that the recession has been much deeper than he forecast earlier though it is on the road to recovery.

In the pre-Budget report next month the chancellor is expected to say that the economy shrank by 4.75 per cent in 2009, shrinking at least one percentage point more than forecast in the Budget in March, reported the BBC yesterday.

The adjustment follows the economy's unexpectedly poor performance in the first three months of the year.

But he is expected to stick to 2010 forecasts of growth between 1 and 1.5 per cent.

On Thursday, Darling said that since the Budget forecasts were made, "new data has shown that most economies, ours included, suffered a severe shock in the first quarter of this year".

Darling last month said that growth will return to Britain by the end of the year.