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UK economy slows down.

London: The UK economic growth slowed more than initially estimated in the second quarter, adding to pressure on Bank of England policy makers to provide more stimulus for the economy.

Gross domestic product rose 0.1 per cent from the first quarter, lower than the 0.2 per cent previously published, the Office for National Statistics (ONS) said yesterday in London. Consumer spending plunged 0.8 per cent, the most since the first quarter of 2009. From a year earlier, GDP rose 0.6 per cent.

The data comes as Bank of England policy makers meet to decide whether they'll revive their bond-purchase program as the government's fiscal squeeze and Europe's debt crisis jeopardise growth prospects. Chancellor of the Exchequer George Osborne announced a plan to aid the economy this week, saying he'll start a program of 'credit easing' to expand company financing.

"UK growth will at best bump along at these low levels for years," said Chris Scicluna, deputy head of economic research at Daiwa Capital Markets Europe in London. "With potentially huge additional downside risks posed by the crisis in Europe, the case is stronger than ever for the bank to restart bond purchases to keep the economy from sliding into another recession."

The ONS published revisions to economic data yesterday. The recession in 2008 and 2009 is still estimated to have begun in the second quarter of 2008 but ended one quarter earlier than estimated. The peak-to-trough decline in GDP was 7.1 per cent, more than the previously reported 6.4 per cent, the ONS said.

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Publication:Times of Oman (Muscat, Oman)
Geographic Code:4EUUK
Date:Oct 6, 2011
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