UK recession part one
As we hear confirmation that the UK economy shrank by 0.5% in the three months to the end of September the country is edging closer to its first recession since the 1990s. The longest run of quarterly growth economic growth since 1955 has finally come to a close and it will get much worse before we see any improvement.
Quite why the stock market fell by around 8% on the news is a little mystifying as it as been on the cards for some time but the reality that the UK is in big trouble seems to have spooked many investors. Sterling has also fallen to a new five year low of $1.5616 which is a far cry from just 12 months ago when it was trading at around $2 to the pound.
It now seems inevitable that the tail spin in which the UK has found itself will continue well into next year and we will see many more down months before the economy recovers. After a period of grace from any serious criticism it looks as though Gordon Brown could be in for a tricky few months and will have to battle hard to keep his fight back going.
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