The International Monetary Fund (IMF) announced yesterday it had cut further its growth forecasts for the UK, as reports warn that the global economy is now entering a ‘dangerous new phase’.
The UK’s Gross Domestic Product (GDP) growth for 2011 is predicted to be 1.1%, down from the 1.5% that had been forecast in June by the IMF.
In line with this, 2012’s growth predictions also saw a cut, from a previous figure of 2.3% to 1.6%.
The IMF’s 2011 growth forecasts for the UK were lower than for its major Western European and North American counterparts. But in 2012, it is forecast the UK will lead the way in growth.
A spokesman for the treaty said about the forecasts, “It is welcome that the IMF have forecast that the UK will grow more strongly than Germany, France and the euro-zone next year.
"But it is clear that the UK is not immune to what is going on in our biggest export markets, with every major economy seeing lower forecasts for growth this year and next.
European countries were advised to closely monitor the euro zone crisis as well as the slow activity in the US, as global growth continues to be inhibited.