By Marcus Leach

Official figures released today (Thursday) by the Office for National Statistics (ONS) showed that the economy in fact shrank 0.4% in the fourth quarter of 2011, and not 0.3% as was originally predicted.

However, the original estimate for the first quarter of this year, which was 0.3%, has remained unchanged.

This revised figure shows that the UK's recession is worse than was originally thought.

"No amount of extenuating circumstances can mask the economy's serious weakness in the first three months of the year," Ranvir Singh, CEO of the market analysts RANsquawk, commented.

"All eyes will now turn to the Bank of England to see how it will respond. But the sages of the MPC are far from united in their approach.

"The Bank’s Chief Economist, Spencer Dale, most recently said he wants more stimulus and that the BoE should explore measures to improve the flow of bank credit.

"Governor King has refused to rule out a further cut in interest rates, but with inflation falling once again a further dose of QE has to be a racing certainty.

"Little solace is likely to come from today's EU Summit either, with Germany clearly unwilling to 'take one for the team'.

"The Eurozone crisis will not be solved by the furrowing of prime ministerial brows in Brussels today, and it will continue to cloud Britain's already bleak economic outlook."

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