British economy is expected to increase 2.4 percent for this year with the economic recovery and sustainability of the uprising gaining momentum, according to a poll of economists issued on Thursday.
The annual poll involving 100 economist conducted by the Financial Times said “after three yeas of virtual stagnation amid an intense global debate over the austerity measures taken by the UK, the country’s economy was one of the few to beat expectation over the second half of last year, when the recoveries in the euro area and Japan faltered.”
According to forecasts made by the economists, British gross domestic product (GDP) will grow 2.4 percent in 2014, much higher than a forecast of 1.4 percent they made a year ago.
British economy grew by 0.8 percent in the third quarter of 2013 from the previous three months, official figures showed.
A large majority of the respondents believes the recovery will at least maintain its recent strength and household will begin to feel better off in 2014.
They said that in the new year, wages would begin to grow faster than prices and unemployment continues to fall.
The respondents forecast that inflation rate, also known as consumer price index (CPI), will be 2.4 percent this year, up from a forecast of 2.3 percent a year ago.
Unemployment rate prediction is down to 7.1 percent for 2014, compared with the previous 7.5 percent.
British central bank, the Bank of England, explicitly targeted 7 percent unemployment as its threshold point for considering a rise in the bank rate from its current historic low of 0.5 percent where it has been since early 2009.
Official figures showed British unemployment rate dropped to 7.4 percent for the three months ending in October, which was down 0.3 percentage points compared to the previous period from May to July.
However, the economist also pointed out many weaknesses in British economy such as high debts and poor trading performance.
Diane Coyle of Enlightenment Economics warned that the supply side of the economy was holding it back.
“There are multiple and long-standing problems with the economy’s capacity to produce and exports, from long-term sills gaps, and a lack of investment in both
infrastructure and business, to the absence of strong supply chains in many industries and an absence of finance for growing companies,” the Financial Times quoted the economist Coyle as saying.
Source: Xinhuanet
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