IMF Boosts UK Growth Prediction

IMF Boosts UK Growth Prediction.

The International Monetary Fund has revised down much of the planet for economic growth forecasts but has upgraded the UK for even higher growth for this year and next.

Emerging markets are suppressed on weak demand from the west, with a global growth forecast down from 3.8% to 3.6% next year and 3.2% down to 2.9% for this year.

Whilst the UK is still slowly clawing its way out of recession, growth forecasts have been revised upwards by 0.5% from 1.4% to 1.9% for this year.

The IMF’s view of the UK is equally optimistic for next year, with growth forecast up 0.4% from 1.5% to 1.9% next year.

Comments

These figures are still below UK trend growth of around 2.5%pa, but they are clearly moving in the right direction and must be positive news for Chancellor, George Osborne for 2013 and 2014 as we move towards a General Election year in 2015.

Whilst we actually like the Liberal Democrats for being a solid foil for the Conservatives within a coalition government, we suggest that house price “feel good” factor rises that will come this year and next and that unemployment should start to fall in 2014, together with positive economic growth results, could really lead to a “blue” election victory in 2015. 

Whether you like red, blue, yellow or green politics, from a financial planning perspective, we are planning for “blue” and this is how we are advising clients in trying to second guess property markets, taxation and investment opportunities over the next few years.