Britain is being left behind. With growth projections down, unemployment up, and consumer confidence down, the UK economy contrasts sharply with news around the world.
Britain is being left behind by the G7. With growth projections down, unemployment up, and consumer confidence down, the economic outlook in the UK contrasted sharply this week with economic news from its major competitors.
On Wednesday, Britain was hit by a triple whammy of new economic data. Mervyn King downgraded the Bank of England’s growth figures, saying “the projection for four-quarter growth is weaker than in November for much of 2011”, while unemployment rose to 1.46 million. Consumer confidence fell to just six points above its all-time low of 41 points.
Britain’s predicament is even gloomier when compared with other G7 countries. In the US, the Washington Post reported that:
“Federal Reserve policymakers expect the U.S. economy to grow as much as 3.9 percent this year, slightly higher than earlier projections, according to minutes of the central bank’s latest policy meeting…
“The Fed committee raised its forecast of 2011 growth in gross domestic product from a range of 3 to 3.6 percent to 3.4 to 3.9 percent.”
And despite contracting in Q4 Japan enjoyed a boost this week with Bloomberg outlining that:
“Japan’s central bank upgraded its assessment of the world’s No. 3 economy for the first time in nine months amid an upturn in exports and production. It left interest rates unchanged as expected…
“The pace of Japan’s export growth started picking up in late last year with exports in December rising 13 percent year-on-year following a nine percent increase in the previous month.”
Canada has reported its strongest growth rate in nine months while earlier this week Eurostat showed that France grew by 0.3% in the final quarter of 2010 and Germany was growing at 0.4%. Although lower than expected it contrasted sharply with the UK.
With the Budget under five weeks away, all eyes will be on the Chancellor to see whether he is forced to downgrade his own growth projections and choose a different course.
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12 Responses to “Britain’s economy falls further behind G7”
Mark Stevo
Will, wearer adjusted the UK was probably close to flat, I hardly think single quarter growth rates of 0.3% and 0.4% in asinine quarter represent a ringing endorsement of their economic policies. As for the US, you’ve neglected to compare with the US’s 2009 performance, which was significantly worse than the UK and it’s hardly surprising that we should see a rebound in performance there.
Rachael Jolley
RT @leftfootfwd: Britain's economy falls further behind G7: http://bit.ly/hBxr4Q reports @wdjstraw
Mark Stevo
Will correct myself before anyone else does, I’d misread US Performance in 09 which was much beter than the UK. Is that a failing of Balls and Brown?
L DTUC
RT @leftfootfwd: Britain's economy falls further behind G7: http://bit.ly/hBxr4Q reports @wdjstraw
Ash
“forced to downgrade his own growth projections and choose a different course” – I’m struggling to imagine a circumstance in which Osborne would choose a different course. According to the Tory narrative, cutting the deficit more slowly would only make things worse, and relying more on tax rises rather than spending cuts would also only make things worse; so however bad things get, I don’t see they have any option but to stick to their cuts agenda. If anything I’d expect them to just hit the brake (which they think is the accelerator, of course) even harder.