LONDON - Britain is going to face a major economic blow as the country is on the verge of a recession and the number of permanent job vacancies is falling, two reports warned on Tuesday. The British Chambers of Commerce describes the outlook as 'grim' and warns that a recession could start within months. It says it has uncovered evidence of a 'menacing deterioration' in the economic outlook. Another report, from the accountants KPMG, shows that the number of permanent job vacancies fell in June for the first time in five years. Their publication came as the FTSE 100 Index fell more than 140 points in the first hour of trading in a knock-on effect after a sharp overnight fall on Wall Street. Speculation two U.S. mortgage providers might have to raise more capital and make more writedowns triggered the American sell-off. In the UK, the deepening economic crisis has left the Treasury facing a 7.5billion black hole in its Budget next year, according to a respected research body. The figures, collated by the National Institute of Economic and Social Research, will increase anxiety among Labour MPs that they are heading towards a general election with the public finances in turmoil. Such a deficit - if proved to be that large - will mean that British Finance Secretary Chancellor Alistair Darling will either have to put up taxes, cut spending or borrow more.The black hole is the equivalent of cutting 57,000 teaching jobs, cancelling two giant aircraft carriers ordered by the British Ministry of Defence and closing five hospitals. The British Chambers of Commerce said the number of people being put into permanent jobs by recruitment agencies fell at its sharpest rate in more than five years.   It also said it fears for workers' jobs over the next 18 months, predicting up to 300,000 could be affected. This is equal to 550 losing their jobs every day, including weekends, by the end of 2009.  David Frost, director general of the business lobby group, said there is 'a real risk of recession in the coming months'. He said: 'The outlook is grim. We believe that the correction period is likely to be longer and nastier than anticipated.' Nearly 5,000 firms took part in the research for the BCC report.