THE UK will remained mired in a double dip recession for most of 2012, before a sluggish recovery through 2013, according to reports from two prominent business groups.
The British Chambers of Commerce (BCC) this morning slashed growth forecasts for this year and the next, just a day after the Confederation of British Industry (CBI) did the same to its own predictions.
The CBI cited a weak first half yesterday as it cut growth expectations for this year from 0.6 per cent to minus 0.3 per cent, and sliced its 2013 forecast to just 1.2 per cent, having thought in May that next year would see the UK economy grow two per cent.
Despite this gloomy prognosis, CBI director general John Cridland resisted laying into the policymaking regime, and said he stood shoulder-to-shoulder with chancellor George Osborne on his policies intended to slow down the growth of the national debt.
But Cridland did think there was some “low-hanging fruit” that the government could potentially pick. He said that he wanted the government to rebalance the budget away from current spending, and towards capital spending, particularly on infrastructure.
The BCC echoed the CBI with similarly sharp cuts in its forecasts – having anticipated that output would edge up 0.1 per cent in 2012, it now thinks it will shrink 0.4 per cent, while it also forecasts that 2013 will see a 1.2 per cent economic expansion.