UK Avoids Triple Dip Recession

UK Avoids Triple Dip Recession.

The UK has just about managed to avoid a third recession, the so called triple dip.

The Office for National Statistics today released figures that showed the UK’s economy had grown by 0.3% for the first quarter of 2013.

The figures are pleasing given that both the Treasury and the IMF had downgraded the UK growth forecast for 2013 to around 0.8%.

Our view
Politically this is good news for George Osborne. He will no doubt claim a small victory.

What does GDP growth really mean?

To us it means less people being made redundant.

It means confidence in banks being able to lend to business.

It means business being confident to invest in new developments.

It means businesses being confident to recruit.

0.3% is not a huge confidence boost but many were predicting a fall of -0.1% to -0.2%. That is a swing of 0.5% GDP growth.

So in real terms it is good, but clearly not spectacular as we are sure the Chancellor would like to see stable 2%+ growth figures with a falling budget deficit.