Outlook for UK Economy

The UK economy enters 2009, with its worst economic outlook since the early 1980s.

The economy is in recession, with growth falling 0.5% in the last quarter

• Unemployment is on the rise and is forecast to keep rising well into 2010
• Government borrowing and National debt is increasing as the effects of the recession lead to lower tax revenues. This could lead to higher tax rates in the future.
• Pound Sterling is falling as the prospect of significantly lower interest rates cause investors to leave the pound.
• Housing Market still in decline as lack of mortgages causes very low level of property transactions.
• Saving ratios likely to rise as low consumer confidence encourages people to save rather than spend.
  

• The case for lower interest rates in UK