UK GDP is estimated to have decreased by 0.3 per cent in Q4 2012 compared with Q3 2012, the Office for National Statistics announced today.

Production industry output decreased by 1.8 per cent in Q4 2012 compared with Q3 2012, following an increase of 0.7 per cent between the second and third quarters.

Service industry output was estimated to have been flat in Q4 2012 compared to Q3 2012, following an increase of 1.2 per cent.

Schroders European economist Azad Zangana said that the contraction was the fourth quarterly contraction in the last five quarters. “Part of the negative hit to growth was caused by an Olympics hangover, where the boost in the third quarter disappeared. This should be seen as a one-off hit to the economy.

"However, now that a negative GDP has been recorded there is a significant risk that the UK economy suffers a triple-dip recession. Weak underlying economic activity coupled with the disruption of recent poor weather could cause GDP to fall in Q4 2013,” Zangana added.

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