UK growth forecast for 2011 cut further

Economic growth forecasts for the UK in 2011 were again downgraded for the third time this year by the British Chambers of Commerce (BCC) as continued poor economic figures inhibited growth.

The UK economy is now expected to grow by just 1.1%, down from 1.9% at the beginning of the year and 1.3% at the start of the summer in June.

At the same time, growth forecasts for 2012 were cut 0.1%, to 2.1%.

Director General of the BCC David Frost urged the government to proactively try and help companies grow, “The government is right to reduce the deficit, but these measures must be matched by policies to stimulate growth”.

Quantitative easing was another idea again suggested by the BCC, in an effort to try to boost money available for bank lending and thus impact positively on the wider economy.

The Bank of England had cut its own forecast for growth from 1.75% to 1.4% last month, after debt woes in the euro zone were said by governor Mervyn King to have the potential to have “a significant impact on the UK economy.”