The Item Club’s latest forecast is that the UK may already have slipped back into recession. The think tank has said that the UK’s GDP shrank in the final quarter of last year and is very likely to contract again during the first three months of this year.
A survey carried out by The British Chambers of Commerce (BCC) has suggested that the UK economy is likely to remain weak for some time to come, but slipping back into recession is by no means inevitable.
However, the survey of more than 6,000 UK businesses also found that domestic demand is at its lowest level for more than two years. But the BCC said that the results do not indicate a recession and are still better than those seen in the
George Osborne’s November statement on Tuesday raised a few key concerns with regard to the UK economy, but none came as a surprise to markets. The GDP growth forecasts have been revised down to 0,9% for 2011 and 0.7% for 2012 (from 1.7% and 2.5% respectively). Future growth forecasts from the Office for Budget Responsibility (OBR) are 2.1% for 2013, 2.7% in 2015 and 3% in both 2015 and 2016. The Chancellor also said that the
The UK Chancellor George Osborne is today preparing his Autumn Statement, an update on the state of the UK economy. He will also outline plans to boost the sluggish growth, which the OECD has warned is likely to slip back into recession.
Inflation in the UK is back up to 5.2% according to the latest figures published for September. The last time that it was this high was in September 2008 – the peak of the ‘credit crunch’. In September 2009, a year later, inflation had fallen again to just 1.1%. Similarly, the markets are now pricing in an average inflation level for 2012 of 2.5%, with this most recent figure the peak. Good news? Maybe not…