According to the governor of the Bank of England, Sir Mervyn King, the crisis in the eurozone is the "single biggest risk" to the UK. He also said the country's economic outlook has worsened and that the UK economy could stagnate until the middle of 2012. The Bank of England has cut its 2011 and 2012 growth predictions to about 1%.

Sir Mervyn King said, "The immediate impact of the decline in sentiment is that the outlook for growth for the world economy has worsened since August. This is also true here in the United Kingdom, where activity could be broadly flat until the middle of next year."

The news came as the UK unemployment total rose in the three months to September by 129,000 and now stands at 2.62 million. This is the largest unemployment total since 1994.