OECD: Growth is returning to UK’s economy

Tim Wallace
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THE UK economy reached a turning point at the start of 2012, and may now be on a positive growth path, forward-looking data suggested yesterday.

The OECD data was accompanied by a rise in permanent jobs placements according to the Recruitment and Employment Confederation, though an Ipsos Mori study showed consumers remain cautious as the economy’s growth remains slow.

January and February both pointed to an improving outlook on the OECD’s leading index, which seeks to predict economic turning points six months in advance.

Hiring figures from the REC show an increase in permanent placements for the third consecutive month, with vacancies in the IT sector up to an eight-month high.

However, economists warned the recovery remains weak and faces some risks.

“The recent gradually improving trend in the OECD indicator ties in with our belief that the UK eked out modest growth in the first quarter, most probably around 0.2 per cent to 0.3 per cent quarter-on-quarter,” said IHS Global Insight’s Howard Archer.

“However, the economy still faces serious domestic and international headwinds, and it is likely to remain prone to relapses over the next few months at least.”

Those risks are underlined by an Ipsos Mori study showing only 10 per cent of Britons believe the economy is in a “good” state.