The Organisation for Economic Co-Operation and Development said the UK experienced a contraction of 1.2% in the fourth quarter of last year, and shrank 0.4% in the first quarter of 2012. Two consecutive quarters of negative growth means the economy is in technical recession.
However, it is predicting the economy will grow 0.5% in the second quarter of this year.
The OECD said growth in the G7 countries is likely to be firmer through the first half of this year.
Chief economist Pier Carlo Padoan said the recovery “remains fragile and will likely proceed at different speeds in North America and Europe.”
The OECD presented its findings in its Interim Economic Assessment, in which it predicted G7 economies will grow by 1.9% in both the first and second quarters of the year.
“Our forecast for the first half of 2012 points to robust growth in the United States and Canada, but much weaker activity in Europe,” Padoan said.
“We may have stepped back from the edge of the cliff, but there is still no room for complacency.”
The OECD projects the euro area’s three largest economies – Germany, France and Italy – will shrink by 0.4% on average during the first quarter, before a moderate 0.9% growth recovery in the second quarter.
“Government action will continue to be critical, particularly in the euro area, where unfinished policy business on fiscal frameworks, financial firewalls and fundamental structural reforms must move ahead,” Padoan said.
