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Hopes rise for economic recovery
9 Sep 2009Hopes were building today for a swift economic recovery after a swathe of encouraging signs suggested Britain was already on the road to growth.
As economic forecasters hailed the first quarterly growth since May last year, data also signalled some welcome cheer in the jobs market and on Britain's battered high street.
The latest report from the Recruitment and Employment Confederation confirmed the first improvement in the UK jobs market for 17 months as the fall in vacancies and pay eased.
And consumers appear to be shaking off recession gloom, as Nationwide's index found increases in confidence across all of its measures last month.
Cash-strapped Britons were meanwhile given further reason to cheer as shop prices fell last month by 0.1% compared with a year ago in the first decline since February 2007.
The figures follow just a day after economic thinktank the National Institute of Economic and Social Research declared a return to growth in the three months to July.
Official manufacturing figures out yesterday also added to the mounting economic optimism, with the sector showing its strongest growth in more than three years during July.
The outlook for the UK economy has been steadily improving since the dark days of the first quarter, when gross domestic product (GDP) plunged by 2.4% after the autumn financial crisis tipped the world into recession.
Figures recently revealed the contraction had eased by more than originally thought in the second quarter, with GDP down by 0.7% compared with the 0.8% initial estimate.
Stock markets have already bounced higher on a mounting wave of optimism, with London's FTSE 100 Index yesterday reaching its highest level so far this year.
The Dow Jones Industrial Average on Wall Street is also trading at levels not seen since last November as America's economy likewise appears to be on the mend.
While the UK faces an uphill struggle to get public finances back on track after unprecedented spending to ease recession, there was even better news on this front as reports suggested Britain may avoid the threat of a ratings downgrade.
Rating agency Moody's is expected to announce that the UK is likely to retain its triple A credit rating in view of the determination shown by political parties to rein in public spending.
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Reader views (2)
Of course things will perk up when there have been such huge financial stimuli but they'll soon wear off and down we'll go again except that this time unemployment will soar as unavoidable cuts in public spending are implemented and inflation surges. You can't borrow your way out of debt; all Brown and Darling have done is to delay the inevitable pain in a vain ateempt to hold on to power. Next year, and perhaps before that, Expect social unrest, currency crises and political turmoil with the emergence of a new party of the right with a charismatic leader promising to save the country.
- John, Dartford, 09/09/2009 09:41
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It is to be expected as government induced National Debt rockets to £2T.
- William, Hay~Heath UK, 09/09/2009 09:35
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