Gloomy forecast for UK's economy

Britain's GDP will shrink by 0.5% in 2012, a leading economic thinktank forecast today in one of the gloomiest assessments yet of the state of the economy.

The prediction by the National Institute of Economic and Social Research (Niesr) was down sharply from its zero growth forecast in May, issued before the publication of official figures showing the economy contracted by 0.7% in the second quarter of 2012 alone.