UK economy to 'zig-zag', says Mervyn King

The Bank of England says the UK is unlikely to enter recession this year and believes growth will be around 1.2%.

It also forecast that inflation would drop to the government's target of 2% by the end of 2012 and will fall further next year.

However, Bank of England Governor Sir Mervyn King, warned that the UK economy will "zig-zag this year".