UK economy falls back into recession Britain's economy slid back into technical recession in the first quarter of this year, with the contraction led by a decline in the construction sector, official data show. The UK economy contracted 0.2 per cent in the three months to the end of March on top of a 0.3 per cent decline in the last quarter of 2011, providing two successive quarters of a decline in output, which many economists would describe as a recession. "This is the first double-dip since that of the 1970s," said George Buckley, economist at Deutsche Bank, referring to a pattern where a post-recession recovery is punctured by a decline in output soon after. In recent weeks, however, some economists have questioned the accuracy of the official data from the Office for National Statistics, noting that industry surveys from the services, manufacturing and construction sectors show much stronger growth. According to the ONS, the construction sector proved to be the biggest drag on the UK economy in the first quarter, with output falling 3 per cent, after a 0.2 per cent decline in the last three months of 2011. Howard Archer, economist at IHS Global Insight, noted that economists in particular have questioned the accuracy of the construction data, which knocked 0.2 per cent off GDP. Without the effects of the construction sector, output would have flatlined in the first quarter. Separately, the ONS reported that the Index of Services - which covers about 75 per cent of business output - showed a decline in February of 0.4 per cent, but for the quarter as a whole, it was up 0.1 per cent. That is just strong enough to reverse the 0.1 per cent decline seen in the last three months of 2011. The pound fell across the board, currency traders said, with some now adjusting their expectations that the Bank of England, after appearing to signal an end to its gilts purchases - quantitative easing - may decide to resume them. Economists had broadly expected first-quarter GDP to show a rise of 0.1 per cent, rather than a fall of any size. Chancellor George Osborne said the eurozone crisis had impeded Britain's recovery and that the economy was proving more difficult to repair than had been expected. "It's a very tough economic situation," said Mr Osborne. It's taking longer than anyone hoped to recover from the biggest debt crisis of our lifetime. The one thing that would make the situation even worse would be to abandon our credible plan and deliberately add more borrowing and even more debt. The TUC, the nation's largest trades union body, countered that, however. Brendan Barber, general secretary, said: "Austerity isn't working. The government should look across the Atlantic and follow President Obama's alternative that has reduced unemployment and brought growth back to the USA.