by: Angela Monaghan
August 7, 2012
The British economy shrank by 0.2pc in the three months to the end of the July according to the National Institute of Economic and Social Research.
It followed a 0.7pc fall in gross domestic product in the three months to the end of June, which left Britain in its first double-dip recession since 1975.
The think-tank estimated the economy grew by 1.4pc in July alone, but senior research fellow Simon Kirby said the number was “flattered” partly by a rebound in activity following the work lost over the Jubilee bank holiday weekend in June.
“The underlying economy is probably weaker than the figure would suggest. It doesn’t change the view that the economy is essentially flat,” he said.
NIESR’s estimate came as the Bank of England was poised to give a gloomy assessment of the economy’s prospects in its latest forecasts on Wednesday.
The Bank of England is expected to sharply downgrade its forecasts for growth and inflation when it publishes its August Inflation Report .