The underlying problems in the eurozone - the UK's biggest trade partner - have been underlined by figures showing the fifth successive monthly decline in the manufacturing sector.
The Markit/CIPS purchasing managers' index (PMI) survey, where a reading below 50 indicates a contraction, rose slightly to 46.9 in December, up from 46.4 the previous month. The average PMI reading in the final quarter of 2011 was nevertheless the weakest since the second quarter of 2009.
The decline in the sector came as firms faced declining order inflows, a slowing global economy and ongoing financial market turbulence, while the broader eurozone debt crisis hits confidence.
The eurozone crisis has frequently been cited as one of the greatest threats to economic stability in the UK, from Chancellor George Osborne to Bank of England Governor Sir Mervyn King, as 2012 is set to be a crunch year for the 17-nation bloc.
While nations such as Italy, Spain and Greece battle with vast levels of debt, the ongoing problems of weak growth and high unemployment persist.