Double-dip fears as economy suffers shock contraction

The UK economy shrunk by 0.5 per cent in the final three months of 2010, as bad weather and public spending cuts hit economic activity, figures have shown.The contraction came as a surprise to economists, who had forecasted growth of between 0.2 per cent and 0.6 per cent. Although the bad performance has been widely blamed on the heavy snowfalls across much of the country in November and December, it will stoke fears that the UK is set for a double-dip recession.