IMF cuts growth forecast for UK

Myanmar News.Net
Wednesday 6th August, 2008

The International Monetary Fund has cut its forecast for UK economic growth over the next two years.

The IMF predicted the UK would grow by 1.4% in 2008 and 1.1% in 2009.

The figures are down from its original predictions in July of 1.8% for 2008 and 1.7% for 2009.

It said inflation at 3.8% was higher than expected, and inflation expectations were rising.

The IMF growth forecast for 2009 is substantially below the official forecast of the UK government, which is still expecting growth to pick up to around 2.5% next year.

The IMF pointed out that it could take years of fiscal adjustment, with sharp spending cuts or tax rises of up to 1% of GDP a year up to 2013, to bring the budget back into balance.

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