Difficult times for the UK economy
It was estimated that it was difficult for the UK economy to emerge from recession but it is quite surprising that they emerged from recession more quickly than originally estimated. It was shown by the new figures. In the second estimation of growth of economy by the Office for National Statistics shows that the gross domestic product of Britain grew 0.3pc in the final three months of the year. The City economist had fore-casted revised figure i.e. 0.2pc. So the figure shown by ONS is up from the first estimate growth and is also stronger than revised City economist rate. Difficult times for the UK economy
A better performance is shown by most part of the UK economy which helps it to emerge from recession quickly. Initially the estimated growth of economy was 0.1pc but now it has grown to 0.5pc because of the service sector that is the biggest part of the economy. Manufacturing also did well and it has also revised upward. It means the revised figure of industrial production grew to 0.4pc from the initial 0.1pc.
Gordon Brown detained this news as evidence that for sustainable recovery the UK government has continuously and successfully steered Britain. The revised figures for the UK economy come as the political debate intensifys over how to cut the deficit of the country’s record debt without destroying the recovery. According to George Osborne cultivating the deficit is a great way for sustaining the recovery while Labour thinks that it would tilt the country back into recession.
However this year the revised data shows a mixed picture for the UK economy because the retail sales and house prices suggest that the recovery of UK economy is already losing impetus. However The Bank of England and the Treasury are both expecting the growth of UK economy more than 1.5pc this year. Economists are also divided equally on how to tackle the UK deficit.
They are worried that, not only will the growth not support the economy of UK, the fiscal deficit will make the country vulnerable to economic crisis. This may lead to adjustments of rates on a long term basis as well as more financial difficulty.
