GDP growth 'was only 1% in first quarter' says think-tank

THE UK's economic growth prospects were dealt a blow yesterday when one respected think-tank estimated that gross domestic product (GDP) grew by just 0.1 per cent in the second quarter of 2011.

The National Institute of Economic and Social Research (NIESR) suggested growth had slowed from an official rate of 0.5 per cent in the first quarter, partly because of a weak performance in April which was disrupted by additional bank holidays.

The body said that although the figures may have been distorted by one-off events such as the wedding, the underlying growth rate was likely to be weak.

Many economists expect GDP to rise by 0.3 per cent in the second quarter of 2011. The NIESR noted that its predictions were normally accurate to within 0.1 per cent or 0.2 per cent.

It does not expect output to pass its pre-recession peak until 2013.