The Bank of England Governor says that despite a resilient labour market, the economy has barely grown over the past two years.
Sir Mervyn King said: "The unexpected weakness reflects the impact of the euro area crisis and its effect on confidence and bank funding costs - and the sharp squeeze on real incomes from higher-than-expected world energy and food prices."
More top news
Three people who had been arrested on suspicion of murder have been released without any further action.
Zimbabwe's ruling party is to hold a meeting after Robert Mugabe ignored an ultimatum to resign or face impeachment.
The former WTA World No 1 doubles and No 2 singles champion died after a long battle with cancer.