NIESR, which estimated the UK’s economy grew by just 0.3% in the three months to April, said in its latest release unless output turns down again, the UK’s recession is over.
Instead it expects the country to experience a prolonged period of depression.
NIESR said: “The National Institute interprets the term “recession” to mean a period when output is falling or receding, while “depression” is a period when output is depressed below its previous peak.
“Thus, unless output turns down again, the recession is over, while the period of depression is likely to continue for some time. We do not expect output to pass its peak in early 2008 until 2013.”
NIESR also said it has not made an allowance for the holidays and activities relating to the royal wedding, which could impact growth even more further on the downside.
