UK economy heading for worst year since crash, say economists
-We have a biting cold wind now for months
-Homeless lie on the streets everywhere (but the Government denies they are there)
-A crime wave of murder (and violence and violent behaviour) exists in the capital (which the Government denies)
-Businesses are closing and failing (but the Government pretends all is OK)
A person (a trader) I met yesterday described London as a zoo !!
Food is expensive, rents are high, the NHS falling apart….
Train services are expensive and overcrowded
Forecasting body blames growing risks of no-deal Brexit as it downgrades estimate
The British economy is heading for its worst year in almost a decade amid the growing risks from no-deal Brexit, according to a leading economic forecaster.
After official figures revealed zero growth in GDP in August, the EY Item Club said the economy would struggle to recover in the final months of the year owing to the increasing likelihood of Britain crashing out of the EU in less than six months’ time.
The group of economists, which is the only non-government forecasting organisation to use the Treasury modelling of the economy, said it had downgraded its growth forecast for this year and next as a consequence.
It forecast growth of 1.3% for the whole of 2018, down from a previous estimate of 1.4%. This would be the worst annual period for growth since the financial crisis. It also downgraded the outlook for the second quarter running.
The Item Club said Brexit uncertainties were influencing business investment decisions, but added that efforts to find alternative suppliers in the UK rather than the EU may lead to an increase in spending.
It also said weaker growth in the eurozone had sapped appetite for exports, as the world economy digests the impact of US import tariffs that have already begun to drag on economic activity.
Inflation is forecast to fall from about 2.7% to 2.3% by the end of the year, above the Bank of England’s target rate.
Consumer spending growth is estimated to remain limited as a consequence, as UK households remain under pressure from weak wage growth and relatively high levels of inflation.
Howard Archer, the chief economic adviser to the Item Club, said: “Heightened uncertainties in the run-up to and the aftermath of the UK’s exit could fuel business and consumer caution. This is a significant factor leading us to trim our GDP forecasts for 2018 and 2019.
“Should the UK leave the EU in March 2019 without any deal, the near-term growth outlook could be significantly weaker.”