In November 2010, the IMF stated said the UK economy was “on the mend”, however since then the economy contracted 0.5% in the last quarter of 2010 and then grew 0.5% during the first three months of 2011.
Ahead of the IMF verdict the FTSE 100, a share index of the 100 most highly capitalised UK companies listed on the London Stock Exchange, fell 0.2% in line with US and Asian economies.
On Sunday, a group of economists and academics called for the government to come up with a Plan B on economic policy stating that the “breakneck deficit-reduction plan, based largely on spending cuts, is self-defeating even on its own terms.”
George Osbourne, chancellor of the exchequer responded saying: “The economy is growing, jobs are being created. We would like the economy to grow further and we would like more jobs to be created.”
In May the Council of Mortgage Lenders said: “The underlying picture is likely to be one of moderate but not spectacular economic growth. Unfortunately, we will not know this for sure for some time, as Q2 growth figures will potentially be affected by erratic construction figures and the reduced number of working days as a result of extended holidays around Easter and the royal wedding.
“A modest pace of economic growth is disappointing, given the depth of the recession that we are recovering from. The immediate direction of house purchase and remortgage activity is uncertain, but there are few signs of the housing market stalling.”
More to follow later...
