London, February 11: CBI, the voice of business, has forecasted a lower gross domestic product Wednesday at a rate of 1.8 percent, which is 2 percent lower than the forecast in December.
CBI Director-General John Cridland said: “The early estimate for GDP growth in the final quarter of last year came as a surprise to everyone, suggesting that underlying growth may have been weaker than previously thought.”
According to the nation’s largest employers’ federation, the risk of a more severe recession is still there. It is also expected that 2011 would be a tough year for households due to price rise and not growing incomes.
Chief economic adviser to the CBI Ian McCafferty said: “The economic outlook remains subdued and conditions for the consumer will be tough for some time to come. But the economy will grow in the coming two years and, in spite of the recent shock of the estimate for GDP in the fourth quarter of 2010, we do not foresee a double-dip recession.”
The businesses demand of facility upgrade has been during the recession, which caused a large fall in business investment in Britain.
However, corporate sectors in Britain are to use their own resources if bank funding remains tight.
“As a consequence, net trade is expected to make a positive contribution to GDP growth throughout the forecast period,” said CBI.
——–Agencies