UK Economy Officially In Recession
It has been made official today with figures released by the Office for National Statistics that the UK Economy has now had two consecutive quarters of negative growth in the Gross Domestic Product. This is probably the worst kept secret of the last few months, few if any commentators expected anything but gloomy news.
The worst hit areas of the economy were the manufacturing sector, which had a fall of 4.6% on the previous quarter, and thus demonstrating that the financial crisis has led to a wide reaching recession that has spread severely into the manufacturing sector.
The only sector that saw any improvement on the previous quarter’s results was the agricultural sector which saw an increase in productivity of 0.1% compared to a 0.4% decrease in the previous quarter. However, this is not exactly a large enough sector that this small amount of good news will have any wider reaching impact on the economy.
Many commentators have been predicting for a while that this recession would be over by christmas 2009, however my opinion, having seen the sharp decline in the figures, is that this recession will be with us well into 2010 and possibly into 2011. If there is any way that this recession could be made less severe, it would involve the current government borrowing heavily and spending lots of money in an attempt to stimulate the economy. A plan that I feel is somewhat flawed, when you consider that this economic downturn has been caused by the lack of cheap credit, or in some cases any credit being made available, causing consumers, and subsequently businesses to reign in their spending.
Did you enjoy this post? Why not leave a comment below and continue the conversation, or subscribe to my feed and get articles like this delivered automatically to your feed reader.
Comments
No comments yet.
Leave a comment