Economy shrank by 0.3%

The economy shrank by 0.3% between October and December, according to the Office for National Statistics. That is worse than previously estimated.

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Ed Balls: 'Our economy has flatlined and not grown at all'

The shadow chancellor, Ed Balls, has responded to the revised GDP figures. He said:

"It's very worrying news that the economy shrank even more than we thought at the end of last year. And these revised figures also show that since George Osborne's spending review our economy has flatlined and not grown at all.

"This slow growth and rising unemployment means the Government is set to borrow an extra £150 billion to pay for the cost of economic failure."

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Effects of the Budget on CPI

The ONS estimate the Budget will add 0.38 percentage points to the 1-month Consumer Price Index (CPI) rate between April and October 2012.

However, as the impact of the Budget last year was similar (0.21 percentage points), only 0.17 points will be added to the 12-month rate over the same period.

CPI measures the changes from month to month in the cost of a representative 'basket' of goods and services bought by consumers within the UK.

Further ONS statistics about the UK's economy

The Office for National Statistics has tweeted:

Headline figures from the Office for National Statistics

The headline figures from the Office for National Statistics are:

  • UK gross domestic product (GDP) in volume terms decreased by 0.3 per cent in the fourth quarter of 2011, revised from a decline of 0.2 per cent previously estimated
  • For the year 2011, GDP in volume terms increased by 0.7 per cent
  • Output of the production industries fell by 1.3 per cent, within which manufacturing fell by 0.7 per cent
  • Output of the service industries fell by 0.1 per cent, while output of the construction industry fell by 0.2 per cent
  • Household final consumption expenditure increased by 0.4 per cent in volume terms in the latest quarter

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