INSTANT VIEW-Q2 GDP revised down to weakest since 1992

LONDON (Reuters) - Britain's economy unexpectedly ground to a halt in the second quarter, its weakest performance since the recession of the early 1990s, revised official data showed on Friday.

The downward revisions to the preliminary estimate of GDP were across the board and are likely to boost expectations of interest rate cuts.

However, policymakers are already factoring in the economy standing still over the next year or so and have said growth needs to slow to tame inflationary pressures.

GEOFFREY DICKS, RBS

"A downward revision to GDP was on the cards but not to zero. Weakness all round with the service sector contracting 0.5 percent in June alone. Domestic demand has fallen for two successive quarters -- (a) recession at home offset by small positive contribution from net exports.

"Output has a mountain to climb to get into positive territory in Q3. But as we said yesterday 5 percent CPI equals 0 percent GDP -- it just came sooner than expected."

JONATHAN LOYNES, CAPITAL ECONOMICS

"The second estimate of Q2 UK GDP clearly increases the already strong chances that the economy will fall into recession over the coming quarters."

"The breakdown of growth makes for pretty gloomy reading. Household spending actually fell by 0.1 percent quarter-on-quarter, despite a solid rise in retail sales, while investment collapsed by 5.3 percent."