The British economy has failed to register any growth at all in the first quarter of 2002, denting expectations of a near-term interest rate rise, revised data shows.
Official data showed gross domestic product was flat in the first quarter from the fourth quarter of 2001, and stood just 1 per cent higher than a year earlier.
This was the weakest annual performance since the fourth quarter of 1992 when the British economy was emerging from its worst post-war recession.
The numbers will scale back market expectations that the Bank of England will put up interest rates - currently at a 38-year low of 4 per cent - sooner rather than later.
Official data said the last time there were two successive quarters of weaker growth was in the third quarter of 1991.
The financial sector declined as the volume of transactions on the stock market fell. Business to business services also fell with declines in advertising, security, legal services, accountancy services, management consultancy, recruitment and architects and engineering services.
The downward revision was also partly due to a weaker than estimated manufacturing performance.
Household expenditure growth slowed as retail sales growth decelerated. Retail sales growth rose by its lowest rate for seven quarters.