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UK economy shrinks by 0.5% in third quarter

Britain's economy shrank 0.5% in the three months to September, marking the first quarterly contraction since 1992, according to unrevised official data today.

The economy had already shown a flat performance in the second quarter with zero growth, added the Office for National Statistics in a statement.

The data means that Britain remains on the verge of recession - which is defined as two quarters of negative economic growth in a row.

Meanwhile, separate figures show that UK consumer spending saw its sharpest decline for 13 years between July and September.

Household spending fell 0.2% on the previous quarter, the biggest drop since the beginning of 1995, according to the Office for National Statistics (ONS).

Overall national output fell 0.5% during the third quarter of 2008, unchanged from the ONS's first estimate in October.