Snow 'could stop us drifting into double-dip recession'

Snow could save Britain from a double-dip recession.

Chancellor George Osborne was given fresh hope of avoiding the "R" word in the next four months after Office for Budget Responsibility Professor Stephen Nickell told the Commons Treasury committee: "If we have a huge bout of snow, that will probably rule out a double-dip recession."

Severe weather warnings have been issued for much of the UK and forecasters say temperatures in London will dip below zero on Friday.

After the second-warmest November since 1910, forecasters have warned that four inches of snow will fall in the next 48 hours in some areas.

Today Mr Nickell claimed that this bad weather could give Mr Osborne a reprieve. Recession is technically defined as two consecutive quarters of negative growth - and while a cold snap would make a shrinking of the economy in the final three months of 2011 even more certain, GDP is then more likely to rebound in the first three months in the New Year - returning us to positive territory.

Britain would then suffer just one quarter of negative growth and so avoid another recession.
A few blizzards in the next few weeks could easily delay growth so Britain was officially saved from another recession, though it could still suffer the same overall economic downturn before another recovery.

"It's got to snow in the fourth quarter," Mr Nickell added, as wintry weather in the New Year would be likely to also depress economic activity then. In a more mainstream forecast, he also warned that Britain's economy could suffer a "fairly disastrous" blow if the eurozone crisis spirals out of control.