The US economy shrank at its fastest pace in the third quarter since the aftermath of the September 11 attacks, figures released today showed.

The US Commerce Department said that gross domestic product (GDP), which is used as a measure of economic health, declined by 0.5 per cent in the July-to-September quarter.

This is the sharpest fall since the third quarter of 2001, in which America reeled from the 9/11 terrorist attacks.

Analysts believe that GDP has fallen even faster in the last quarter of this year and could drop by as much as 6 per cent in the three months from October to the end of December.

This would be the biggest fall since a 6.4 per cent plunge in the first quarter of 1982.

The National Bureau of Economic Research (NBER) said last month that the US fell into recession in December 2007. As well as the usual rule that two consecutive quarters of falling GDP equals a recession, the NBER takes into account data such as job losses.

The US has seen falling employment every month since January this year, with the unemployment rate now at a 15-year high of 6.7 per cent.

GDP fell by 0.2 per cent in the fourth quarter of 2007 before rising for two consecutive quarters, up 0.9 per cent in the first quarter and 2.8 per cent in the second quarter.

Nariman Behravesh, chief economist at IHS Global Insight, the economics consultancy, predicts that GDP will fall by 4 per cent in the first quarter of 2009.

He said: "Assuming that the incoming Obama administration does enact [its] $850 billion (£574.5 billion) financial stimulus package quickly, it will do little to stop real GDP growth from dropping like a stone in the first half of 2009 but could help turn things around in the second half and provide a basis for sustained growth in 2010".

Today's misery was compounded by a survey revealing dire sales in the final weekend before Christmas, in which the lowest number of people in six years turned out to the shops.

A survey released today by the America's Research Group and UBS showed that just 38.7 per cent of people went shopping at the weekend. Those that did shop went to discount stores such as Wal-Mart.

The last Saturday before Christmas is known as Super Saturday because it ranks just behind Black Friday - the day after the Thanksgiving holiday - as the biggest single day of shopping sales in the year.

But a snowstorm in the north-east of America plus worries about unemployment kept shoppers away from the stores.

Last year 41.6 per cent of people went shoping on Super Saturday and the subsequent Sunday. Wal-Mart was the biggest winner in the weekend's shopping, with 69 per cent of shoppers reporting that they visited a Wal-Mart store. this is up from 33 per cent last year.

Earlier today, Britain appeared to be edging closer to recession as official figures showed GDP shrank a worse-than-anticipated 0.6 per cent.

Spain and New Zealand have also officially fallen into recession today.

In further bad news from the US, the National Association of Realtors said that sales of existing properties plummeted by 8.6 per cent in November to just under 4.5 million, down from 4.9 million in October.

The fall in the median sales price was the biggest on record, down 132 per cent from $208,000 a year ago to $181,300. This is the lowest median sales price since February 2004 and the biggest year-on-year fall since records began in 1968.

Sales of new houses also fell in November for the fourth month in a row, down by 2.9 per cent to 407,000, according to Commerce Department figures.

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