CBI Predicts that UK GDP to Remain Sluggish in 2018

United Kingdom flagNow that 2017 almost comes to an end and we are in the throes of the New Year, the financial analysts are soon coming with their market estimates and predictions.

Britain’s biggest business group The Confederation of British Industry (CBI) has stated that global economy will grow for the next two year and the UK economy is going to have sluggish growth in 2018.

For the year 2017, the GDP of UK was 1.5%, and the number is likely to remain unchanged as confirmed by British CBI. The GDP is expected to drop to 1.3% in the year 2019. The global economy is speculated to reach to the figure of 3.7% when 2018 ends.

In a report published by CBI, it states that UK unemployment rate would drop to an all-time 44 years low figure in 2018. In 2017, the unemployment rate was 4.3% which will come down to 3.9% in 2018.

Financial Times

The report further states the UK will show positive signs in trade and economic commerce, but the inflation rate will greatly hurt the country which is speculated to be more than 2% as per BoE (Bank of England). CBI further commented there would be a lot of risks for the market predictions in 2019.

It is because negotiations from Brexit might have significant repercussions on UK economy that can cause damage to the country’s business growth and financial climate. The report believes that both European Union and the United Kingdom would agree for a transition period that will take place in 2018 first quarter.

While most of the market analysts have disagreed on the market predictions made by CBI’s report, but a recent survey from Deloitte shows that the consumers in the UK are worried about their economy. According to the study that was conducted, 68% people have listed economy health to be their number 1 concern which was followed by rising inflation.

The Chief Economist of CBI, Rain Newton-Smith made the following statement:

We expect domestic demand to remain soft. Household spending will remain under pressure from squeezed real wages and Brexit uncertainty will weigh on business investment. But encouragingly, we should see more support from net exports, buoyed by the lower pound and a resurgent global economy.

Top10FX.net Editor

Top10FX.net Editor

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