The UK economy is set for more than a year of recession or stagnation, with only slow recovery thereafter, according to the centre for economics and business research (cebr).
As detailed in its latest United Kingdom prospects report, the consultancy now expects growth of just 1pc this year and 0.3pc in 2009, which would be the lowest since 1992. There is a risk that the economy will weaken further, if the Treasury and Bank of England fail to quickly to re-establish confidence in the wholesale financial markets, the cebr asserted. On the plus side, inflationary pressures are forecast to ease, with CPI inflation expected to fall to 2pc by August 2009. This will provide scope for rapid and substantial cuts in interest rates, with the base rate tipped to have fal...
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