The UK government has confirmed that the nation's gross domestic product fell by 1.5 per cent in the final three months of 2008, and following the 0.6 per cent drop in the previous quarter it means that the UK is now officially in recession.
The drop off is the most sever since 1980 and means GDP is 1.8 per cent down on the same quarter in 2007. As a result, sterling has fallen to a 24 year low against the dollar, the BBC reports.
The figures from the Office for National Statistics were worse than most had predicted, and suggest that the economic slump could last longer than had been previously feared.
Chancellor Alistair Darling said of the news: It's going to be a difficult year for families in the UK. We need to go about the problem with a sense of purpose.”
The news comes amidst a backdrop of rising unemployment and the reigning in of spending on the UK High Street.