U.K. Slashes Growth Forecast

Reuters

The British government announced sharply lower economic growth forecasts on Tuesday and warned that a recession in the euro zone could send the British economy into reverse.

The economy was forecast to grow by only 0.7 percent next year, against a March budget forecast of 2.5 percent, finance minister George Osborne said, presenting figures from the independent Office for Budget Responsibility.

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Growth was expected to recover to 2.1 percent in 2013 but Osborne told parliament the reality could be much worse if the euro zone debt crisis was not solved.