Just days after a damning diagnosis from the OECD, leaked revisions show the IMF expects Britain's economy to shrink by 4.5pc this year compared with previous forecasts of a 4.2pc contraction. By contrast, the IMF expects global GDP to fall by just 1.3pc in 2009, better than earlier predictions of a 1.4pc decline. The leaked forecasts jarred with better-than-expected construction data coming out of the UK. British construction output volumes fell 0.5pc in the second quarter, compared with fears of a 2.2pc decline. The news prompted speculation about a possible upward revision to GDP in the quarter. Philip Shaw, economist at Investec, said: "It does suggest that the economy was close to flattening out between April and June andmakes it a bit more certain we're going to see the economy come out of recession in the third quarter." The IMF expects Britain to fare much better next year, raising its forecasts for growth from 0.2pc to 0.7pc. Germany, on the other hand, is seen shrinking by 0.1pc in 2010, despite returning to growth in the second quarter of this year. Mr Archer said: "Germany has still got problems. Growth was lifted in the second quarter largely because of the car-scrappage scheme. The economy was helped by unemployment being held down by the government subsidising jobs." The forecasts, due for official release in early October, are broadly in line with OECD's revised forecasts for the second half released on Thursday. The IMF declined to comment.IMF cuts Britain's growth forecast
The International Monetary Fund has reportedly slashed its forecast for the UK economy this year, even as it raises predictions for global growth.
Saturday, 5 September 2009
Posts
