The National Institute of Economic and Social Research reported yesterday that the UK economy is, according to their figures, slowing down again.
The thinktank indicated that overall growth had slipped from 0.5% in the three months to May down to 0.1% in the three months to June, implying a 10 month period of practically no growth due to market contractions cancelling out short periods of expansion.
Fall in industrial output and public service cuts are getting most of the blame, meaning that the economy could pick up again if British manufacturers manage to see more demand for products internationally.
And there is a glimmer of possible hope on the horizon. Japan, a major luxury and UK heritage goods consumer, is still finding its feet after the tsunami and the full recovery of that market can only help, while China’s ever-growing middle class still has an equally expanding appetite for all things European.
Not to say that there aren’t still a few major hurdles on the track to recovery though. After all, public spending is undergoing the harshest cuts it’s seen in 40 years with the current government and there have definitely been some (to put it lightly) teething pains associated with the switch to private funding in some sectors and the complete loss of funding in other sectors.
At the moment, the model that the NIESR is working from predicts that it’ll take at the least another two years for the economy to regain the strong period of growth last seen in 2008. However, no need to worry seriously yet: most mainstream economic experts aren’t predicting a double-dip recession.
Are your finances feeling the economic slowdown that the NIESR is reporting? Please share.
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