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The forecast for 2009
Page 48
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THE CONFEDERATION of British Industry (CBI) has issued a revised "darker" forecast for 2009, warning of a sustained economic contraction through 2009 but promising cautious recovery in 2010.
"GDP growth has been revised down from 1.1% to 0.8% and in 2009 the CBI now expects the economy to contract by 1.7% against its forecast in September of 0.3% growth," it says. "The economy is expected to shrink quarter-on-quarter by 0.8% between October and December this year and to contract again for a subsequent three quarters before beginning a slow recovery in 2010."
The key points of its forecast include: • Poorer export prospects (but softened by weakened sterling) • Firms suffering falling demand and credit rationing • Unemployment predicted to reach 2.88 million in 2010 • 1.7% drop in GDP for November • Inflation and interest rates to fall