Economy will ‘remain sluggish’
Mar 22 2010
The UK economy is expected to remain sluggish during 2010 and will not pick up pace until the middle of next year, says the Confederation of British Industry (CBI).
The body predicts GDP will grow annually by 1 per cent in 2010, followed by 2.5 per cent in 2011. This is in contrast to the government’s forecasts of 1.25 per cent and 3.5 per cent respectively.
Richard Lambert, director general of the CBI, says: ‘The economic outlook is improving, but the lack of a clear driver for growth will make for a bumpy ride in the months ahead. The CBI expects the recovery in 2010 to be slow and sluggish, with few signs of real strength until well into next year.
‘To convince international investors that the spiralling budget deficit will not derail the economy, the government must set out a credible plan to balance the books by 2015-16, two years earlier than currently planned.’
The body predicts that unemployment will peak in the autumn, slightly lower than previously thought at around 2.75 million.