Recession in the UK is just months away and the next six to nine months will be "difficult and risky", the British Chambers of Commerce has warned.

The group has predicted either zero or slightly negative growth over the next three quarters but claims a major recession could still be avoided if the Bank of England reduces interest rates.

"Our central scenario envisages that UK bank rate would be cut to 4.75% in 2008, followed by an additional cut to 4.5% in the first quarter of 2009.

"But if it decides not to cut rates in the next three to six months, growth prospects would be worse."

The body also predicted that unemployment would rise by 250,000 or 300,000 over the next two years.