There are further positive signs for the UK's economy today (December 12th), as the British Chambers of Commerce (BCC) has upgraded its growth forecasts for the fourth quarter.
In its Economist Forecast for Q4 2013, which includes predictions for UK growth and unemployment for 2014, the BCC stated that the UK economy is likely to expand by 1.4 per cent for 2013 as a whole, which is up from its previous prediction of 1.3 per cent.
The BCC also stated that growth for 2014 could be as high as 2.7 per cent – up from the previous forecast of 2.2 per cent – but it downwardly revised its predictions for 2015, dropping them from 2.5 per cent to 2.4 per cent.
It was noted by the BCC that UK GDP will be taken above its Q1 2008 pre-recession peak in the second half of 2014 if its figures turn out to be accurate.
Household consumption, which the BCC points out accounts for two-thirds of UK GDP, is expected to be the main driver of growth in 2013 and 2014, with this being boosted by the strong housing market.
Chancellor George Osborne was previously forced to deny that the UK is heading for a new house price bubble, but governor of the Bank of England Mark Carney recently stated that this is a possibility.
Much of the UK's economic growth in recent months has centred on London and the south-east of England, with companies and people in the rest of the country still experiencing the after-effects of the recession.
The BCC's director-general John Longworth stated that it is “really great” to see such positive figures for the UK's economy in 2013.
He said: “But we must acknowledge that longer-term challenges are still looming. As household consumption slows in the medium-term, we have to find ways of boosting business investment and exports as rebalancing our economy is critical to our long-term economic future.”
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