Menu
15/09/2008
CBI Says UK Is In Early Stages Of Recession
The UK is in the early stages of a technical recession, the Confederation of British Industry (CBI) said today.
In its latest forecast a shallow recession through the second half of 2008 means that growth in the economy in 2009 will be the lowest since 1992.
The UK's leading business organisation has cut its GDP growth predictions for both 2008 and 2009, reflecting the sharper-than-expected slowdown over the first half of this year and the impact of weak consumer demand, high energy and commodity prices and the enduring effects of the credit crunch.
The growth forecast for 2008 has been downgraded from 1.7% to 1.1%.
However, GDP should stabilise early in 2009 ahead of a gradual and growing recovery, with quarter-on-quarter GDP growth reaching a near-trend rate of 0.6% by the end of next year. Nevertheless, for 2009 as a whole, the GDP growth forecast has been cut from 1.3% to 0.3%.
Richard Lambert, CBI Director-General, said: "Over the past year our forecasts for economic growth have been shaved lower and lower as the UK economy continues to struggle with the twin impact of higher energy and commodity prices and the credit crunch. Growth in 2009 will be feeble at best.
"Having experienced a rapid loss of momentum in the economy over the first half of 2008, the UK may have entered a mild recession that will hopefully prove short lived. This is not a return to the 1990s, when job cuts and a slump in demand were far more prolonged.
"The squeeze on household incomes and company profit margins from higher costs will begin to ease as the price of oil moves downwards and, although the credit crunch will be with us for some time, conditions are set to improve later in 2009.
"The Bank should have leeway to cut interest rates and, as inflation falls, we should be well placed to move beyond this difficult stage in the business cycle. If all goes well there should be room for a half point cut in November to help restore confidence in the beleaguered economy."
The CBI believes that unemployment will break the two million mark in 2009, reaching 2.01 million and a jobless rate of 6.5%. Average earnings growth is expected to remain fairly subdued, which will aid the improving inflation outlook.
Sharp rises in fuel and food costs, the resulting decline in real incomes and the troubled housing market have undermined consumer confidence and dampened household spending, and the CBI predicts that household consumption will contract by 0.3% in 2009.
(CD/JM)
In its latest forecast a shallow recession through the second half of 2008 means that growth in the economy in 2009 will be the lowest since 1992.
The UK's leading business organisation has cut its GDP growth predictions for both 2008 and 2009, reflecting the sharper-than-expected slowdown over the first half of this year and the impact of weak consumer demand, high energy and commodity prices and the enduring effects of the credit crunch.
The growth forecast for 2008 has been downgraded from 1.7% to 1.1%.
However, GDP should stabilise early in 2009 ahead of a gradual and growing recovery, with quarter-on-quarter GDP growth reaching a near-trend rate of 0.6% by the end of next year. Nevertheless, for 2009 as a whole, the GDP growth forecast has been cut from 1.3% to 0.3%.
Richard Lambert, CBI Director-General, said: "Over the past year our forecasts for economic growth have been shaved lower and lower as the UK economy continues to struggle with the twin impact of higher energy and commodity prices and the credit crunch. Growth in 2009 will be feeble at best.
"Having experienced a rapid loss of momentum in the economy over the first half of 2008, the UK may have entered a mild recession that will hopefully prove short lived. This is not a return to the 1990s, when job cuts and a slump in demand were far more prolonged.
"The squeeze on household incomes and company profit margins from higher costs will begin to ease as the price of oil moves downwards and, although the credit crunch will be with us for some time, conditions are set to improve later in 2009.
"The Bank should have leeway to cut interest rates and, as inflation falls, we should be well placed to move beyond this difficult stage in the business cycle. If all goes well there should be room for a half point cut in November to help restore confidence in the beleaguered economy."
The CBI believes that unemployment will break the two million mark in 2009, reaching 2.01 million and a jobless rate of 6.5%. Average earnings growth is expected to remain fairly subdued, which will aid the improving inflation outlook.
Sharp rises in fuel and food costs, the resulting decline in real incomes and the troubled housing market have undermined consumer confidence and dampened household spending, and the CBI predicts that household consumption will contract by 0.3% in 2009.
(CD/JM)
Related UK National News Stories
Click here for the latest headlines.
19 September 2013
Mother Denies Manslaughter Of Son Found Starved To Death
A 43-year-old woman has been charged with the manslaughter of her son, whose body was found in his cot almost two years after he had died. The mummified body of Hamzah Khan was found at his family home in Bradford, West Yorkshire in September 2011, having laid in a cot in his mother's bedroom for 21 months after his death.
Mother Denies Manslaughter Of Son Found Starved To Death
A 43-year-old woman has been charged with the manslaughter of her son, whose body was found in his cot almost two years after he had died. The mummified body of Hamzah Khan was found at his family home in Bradford, West Yorkshire in September 2011, having laid in a cot in his mother's bedroom for 21 months after his death.
15 February 2013
Convicts Arrested Over Child Murderer Death In Prison
Two inmates have been arrested following the death in prison of a man jailed for the torture and murder of his partner's two-year-old daughter. In February 2009 Subhan Anwar was sentenced to a minimum 23-years after he was convicted of murdering Sanam Navsarka, of Huddersfield, West Yorkshire.
Convicts Arrested Over Child Murderer Death In Prison
Two inmates have been arrested following the death in prison of a man jailed for the torture and murder of his partner's two-year-old daughter. In February 2009 Subhan Anwar was sentenced to a minimum 23-years after he was convicted of murdering Sanam Navsarka, of Huddersfield, West Yorkshire.
26 October 2010
Worboy's Inquiry Reaches 102 Women
Police have reported the number of suspected victims to contact them regarding a serial sex attacker has reached 102. In April 2009 John Worboys, a London taxi driver, was jailed after he was found guilty of 19 charges of drugging and sexually assaulting 12 women.
Worboy's Inquiry Reaches 102 Women
Police have reported the number of suspected victims to contact them regarding a serial sex attacker has reached 102. In April 2009 John Worboys, a London taxi driver, was jailed after he was found guilty of 19 charges of drugging and sexually assaulting 12 women.
12 October 2010
Man Jailed For Murder In East London
An 18-year-old man has been jailed for the murder of his former girlfriend in Manor Park, London. Yahya Gul, 18, changed his plea at the Old Bailey yesterday and pleaded guilty to the murder of student Aliza Mirza, 18. On 3 April 2009, police were called to reports of a woman who collapsed in Forest View Road, in east London.
Man Jailed For Murder In East London
An 18-year-old man has been jailed for the murder of his former girlfriend in Manor Park, London. Yahya Gul, 18, changed his plea at the Old Bailey yesterday and pleaded guilty to the murder of student Aliza Mirza, 18. On 3 April 2009, police were called to reports of a woman who collapsed in Forest View Road, in east London.
14 April 2010
Man Jailed For 1989 Rape
A man who raped a young woman at knifepoint in 1989 has been jailed for nine years. Winston Millington, 45, of Chandos Road NW2, attacked his victim, who was 25 at the time, on 10 January 1989 in MaxRoachPark, Brixton.
Man Jailed For 1989 Rape
A man who raped a young woman at knifepoint in 1989 has been jailed for nine years. Winston Millington, 45, of Chandos Road NW2, attacked his victim, who was 25 at the time, on 10 January 1989 in MaxRoachPark, Brixton.
-
Northern Ireland WeatherThis Evening and Tonight:A few bright spells at first and any showers gradually dying out. Low cloud and mist or drizzle over northern coastal parts will spread south to most areas overnight. Minimum temperature 7 °C.
