forecasts

UK Economy in 2013

  Summary of UK Economy at the Start of 2013 The UK economy starts 2013 after one of the longest periods of economic stagnation on record. GDP has been flat for the past two years, and real GDP is still way below the 2008 peak. Despite the depressing picture of economic growth, unemployment (7.9%) is much lower than might be expected given the sluggish nature of economic growth. However, if we count under-employment (e.g. working fewer hours than would like) and disguised unemployment, then the picture…

Forecast for Pound Sterling in 2013

Forecast for Pound Sterling in 2013

A look at the future prospects for the Pound in the coming months of 2013. The Sterling index measures the value of the Pound Sterling against a basket of trade weighted currencies. InĀ  Dec 2011 the index was 80.4 By Oct 2011, the exchange rate index has increased to 83.6 This modest appreciation in the Pound has occurred despite: Double dip recession in UK UK Inflation remaining above target Growing current account deficit Quantitative easing increasing money supply. One of largest budget deficits in OECD Therefore…

Why Government Debt Forecasts were wrong

Why Government Debt Forecasts were wrong

One feature of the recent crisis has been the degree to which governments underestimated the forecast rise in government borrowing. The IMF produced a report which looked at forecast debt from 2007, and what debt actually was three years later. In ten selected countries, the increase in the gross debt ratio 31.8 2007 forecast for debt in 2010 – 58.8% of GDP. Actual government debt in 2010 – 90.6% of GDP To some extent, this reflects the wider failure to forecast the recession. As well as underestimating debt levels, governments proved widely…