Base rate will remain at historic low until 2012 - CEBR

It says the Office for Budget Responsibility's (OBR's) predictions for economic growth could still prove too high due to unemployment continuing to rise, the weakness of real disposable income growth and the constraints on bank lending. If this was the case, then a further fiscal squeeze could lie ahead, the cebr warns. This is despite the OBR downwardly revising its pre-Budget forecast for growth in 2011 from 2.6% to 2.3%. Cebr said constraints on bank lending will also cause private sector investment to recover more slowly. It adds if economic growth is lower than the OBR expe...