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UK economy recovery to begin next year

UK economy recovery to begin next year

Category: Savings

Updated: 21/04/2009
First Published: 21/04/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The UK economy will begin to see signs of recovery in the spring of next year, according go the Confederation of British Industry (CBI).

In its latest economic forecast, the organisation acknowledges that the first quarter of 2009 has been tougher than expected, but believes is likely to be the low point in terms of quarterly falls in gross domestic product (GDP).

A slowing of the decline in UK GDP is expected throughout the rest of the year. Fragile and slow recovery could follow in the first quarter of 2010, with the economy predicted to reach positive quarter-on-quarter growth of 0.2 per cent.

Richard Lambert, CBI director general, said that banking packages, aggressive monetary policy and fiscal support will steady the pace of decline, and that very weak growth should become apparent in early 2010.

He also delivered a warning to the Government ahead of the 2009 Budget, commenting: "Given falling tax revenues, the shrinking economy and alarming levels of Government debt, we urge the Chancellor to avoid any further fiscal boosts in the Budget.

"Budget measures should be targeted on jobs and investment, with focus on efficiency savings and public service reform."

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