The British economy shrank by 0.5 per cent in the last three months of 2010, according to the Office for National Statistics. George Osborne had expected a slowdown as severe weather caused nationwide disruptions, but the decline in growth took City analysts by surprise.
Labour's new shadow chancellor, Ed Balls, wasted no time in calling for a re-think at the Treasury and was given further ammunition by the outgoing head of the CBI, who heaped scorn on Osborne's growth strategy.
So is Britain on the verge of a much-feared 'double-dip' recession, or was Q4, 2010 merely a blip in an expected bumpy recovery?
To discuss this: Nils Pratley, Phillip Inman and Madeleine Bunting.
Meanwhile on the ski slopes of Davos in Switzerland members of a select political and economic elite are meeting for their annual summit. We hear from our economics editor Larry Elliott whether it is a class that is losing touch with those it represents.
And for a snapshot of the world economy we have an exclusive interview with former IMF chief economist Raghuram Rajan. He claims that the US Treasury's policy of 'quantitative easing' has had little or no effect, and served merely to save face for the department at a time of high unemployment. He also talks about the arguments in his latest book Fault Lines.
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