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IMF warns Britain faces worse recession than any other country



By Benedict Brogan

Last updated at 1:49 AM on 29th January 2009

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More misery: The UK economy will shrink more than any other advanced economy in 2010 (file photo)




Grim warnings of Britain’s worst recession since the Second World War dealt a fresh blow to Gordon Brown’s economic credibility last night.





The International Monetary Fund said the UK would plunge into the deepest recession of any industrialised country this year.





Its report made clear that Mr Brown will probably have to lead Labour into the next election in the middle of a devastating downturn. And, under pressure from David Cameron in the Commons yesterday, the Prime Minister admitted for the first time that this was ‘a deep recession’.





Labour MPs are growing increasingly anxious that they will lose their seats if Mr Brown fails to turn around the economy in time for polling day, which is widely expected in spring 2010.





The latest polls give the Tories a 15-point lead, enough to hand Mr Cameron a decisive majority.





The IMF forecast suggests that output will fall by 2.8 per cent this year, the worst performance since records began in 1948. That would put Britain bottom in the league table of major industrialised countries.

The IMF says GDP will shrink in the U.S. by 1.6 per cent, France by 1.9 per cent, Germany by 2.5 per cent and Japan by 2.6 per cent.










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In an unprecedentedly bleak assessment, it also finds that global growth will collapse to just 0.2 per cent, leaving the world facing a stagnation not seen since the war.




But it is the IMF forecast for 2010 which will worry the Government the most. It reckons that UK growth will come in at a dismal 0.2 per cent for the year, effectively leaving the country in recession up until the election.

[Janny2006]

Shocking how the Credit Crisis has affected the UK. I wonder what the BOEs next move will be. We have to reinvent the whole banking system from the ground up.