Britain is facing the deepest recession of any big industrialised economy, the International Monetary Fund signalled yesterday as it said that the UK economy would shrink 2.8% this year.

The forecast came in a gloomy IMF report that said the world economy would suffer its worst performance for more than 60 years this year. It coincided with a report from the International Labour Organization that said that the global recession would certainly cost at least 18m-30m jobs worldwide, and could claim more than 50m.

The IMF said that world output, measured at market exchange rates, would fall in 2009 for the first time since the second world war. This marks a huge revision – down by more than 1.5 percentage points – from the IMF’s previous forecast for the year, in spite of the inclusion of the fiscal stimulus efforts by governments into its predictions for the first time.

Financial Times