UK economy contracted 0.3% in fourth quarter

Britain's economy contracted by 0.3 percent in the final quarter of 2012, a year in which it recorded zero growth, official data revealed on Friday, putting the country at risk of yet another recession. "After growth of 0.9 percent in third quarter, the economy contracted by 0.3 percent in the fourth quarter of 2012," the Office for National Statistics said in a statement, adding that gross domestic product growth was flat over the year. "GDP is estimated to have been flat between 2011 and 2012," the ONS said. Should Britain's economy shrink also in the current first quarter then the country will enter its third recession since the 2008 global financial crisis. "Given that a technical recession requires two consecutive quarters of falling output, this is arguably not a true 'triple-dip' yet," noted Vicky Redwood, chief UK economist at the Capital Economics research group. "But there are no hard and fast definitions, and another contraction in Q1 is quite possible anyway, especially given the snow disruption." Britain's economy contracted in the fourth quarter after expanding by 0.9 percent in the third quarter of last year, when the country also exited a double-dip recession. However the third-quarter growth was boosted by one-off factors, including the London 2012 Olympic Games and rebounding activity after an extra public holiday for Queen Elizabeth II's Diamond Jubilee. Britain sank into the first phase of a double-dip recession in 2008 as a result of the devastating global financial crisis that sparked a number of vast banking bailouts. The economy rebounded in late 2009 but struggled to stage a convincing recovery and fell back into a second downturn in late 2011, which lasted for three quarters, as the eurozone crisis loomed large. Activity has been hit hard also by deficit-slashing austerity measures from the nation's Conservative-Liberal Democrat coalition government.