U.K.'s Economy Is Set to Shrink Over the Next Year, Times Says

By Jonathan Browning

Aug. 28 (Bloomberg) -- The U.K. economy may shrink over the next year as a deepening recession leads to the first full-year fall in national income since 1991, the London-based Times reported, citing Capital Economics.

The group's assessment makes it the first notable forecasting group to predict that the decline will lead to a full-year decline in gross domestic product over 2009, according to the newspaper.

National income will decline by around 0.2 percent next year, the Times cited Capital Economics as saying, compared with the present average forecast in the City of London of 0.9 percent growth.

The U.K. is likely to be the first ``major economy'' to fall into a recession, the group said, according to the Times.

To contact the reporter on this story: Jonathan Browning in London jbrowning9@bloomberg.net