The fall in output in the industrial countries in 1975 was substantially greater than we and most other observers foresaw a year ago.

After big revisions of the national accounts for the United States, the fall in aggregate output in the member countries of OECD now works out a good deal smaller on our estimates than it did in November. But the final figure still seems likely to be close to 1¾ per cent, compared with our February forecast of ½ per cent. For industrial production we were much wider of the mark, the actual decline being 8–9 per cent as against the 2 per cent that we predicted. Geographically our error was heavily concentrated among the major European countries including the United Kingdom—on the latest figures we actually under-predicted United States output by a substantial amount—and it appears to have sprung from two main sources.