Don’t mention the R-word
Article Category: Debt Management Help and Advice
The UK economy is heading for a slowdown and not the R-word, according to the Institute of Directors (IoD).
In is 2008 UK economic forecast, published today, it says the economy is entering a period of ’stickyflation’ - a period of weaker growth and sticky inflation as opposed to a full-blown recession.
This, it says, is much better than stagflation, which is a period of much weaker growth and falling prices.
The forecast reveals that GDP growth is projected to fall to 1.7 per cent in 2008, from three per cent plus this year.
People are expected to tighten their belts by spending less and reducing debts either by paying them off completely or by consolidating different loans into one overall cheaper one.
Graeme Leach, IoD chief economist, said: "Let’s be clear we’re still not talking about the R-word.
"We’re entering the most uncertain economic period for 15 years… people need to understand that 2008 forecasts are being generated at a time when we still don’t understand the full nature and scale of the impact of the credit crisis."
It would appear that the IoD hedging its bets as to whether we are any nearer to seeing the light at end of the credit crunch tunnel, as it seems most expert financial opinion is.
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