Revised figures show that the economy contracted 2.4 per cent in the first quarter

The UK economy contracted at its fastest rate since 1958 in the first quarter of this year, according to new official figures. The economy contracted 2.4 per cent from January to March, higher than the original estimate of 1.9 per cent.

The Office for National Statistics (ONS) said the fall was due to weaker manufacturing outpout. The ONS also said that the recession began earlier than first thought, during the second quarter of 2008 rather than during July to September.

The Chief Secretary to the Treasury, Liam Byrne, insisted that he remained "confident" that growth would return before the end of the year.

"There have been some tentative signs that the fall in output is moderating and I remain confident but cautious about the prospects for the economy," he said.

Ross Walker, an economist at RBS Financial Markets, said the figures were "disappointing".

"We knew about the construction revisions in advance and the fall wasn't quite as big as the ONS had indicated. But we've got a much bigger fall in services output," he said.

"It's disappointing to have a fall as big as this."

However, economists and business lobby groups have suggested that they are confident that the worst of the recession is now over.

Earlier this month the National Institute of Economic and Social Research estimated that the economy grew by 0.1 per cent in May, following a 0.2 per cent rise in April, but official figures will not be published until the end of July.

The ONS recently revealed that industrial production rose in April, its first month-on-month rise since February of last year.

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