CBI Cuts Forecasts for Growth and Warns of Economic Gloom; the Slowdown Will Continue into Next Year

Western Mail (Cardiff, Wales), March 25, 2008 | Go to article overview

CBI Cuts Forecasts for Growth and Warns of Economic Gloom; the Slowdown Will Continue into Next Year


Byline: Aled Blake

THE UK faces prolonged economic misery from the impact of the credit crunch, a leading business organisation is warning today.

The CBI said the effect of the tighter lending conditions on households and business "was yet to be fully felt" as it slashed growth estimates for this year and next.

Its latest quarterly forecasts now predict UK growth of 1.8%in 2008, weakening to 1.7% the following year.

The increasing pessimism contrasts with its previous expectations of 2% growth this year and 2.1% in 2009.

"The process of credit tightening will act as a drag on real activity, thus prolonging the slowdown into 2009," the CBI said.

The credit crunch has also magnified the effect of five interest rate hikes in the run-up to July last year, intended to cool the UK's soaring growth and ease inflation, the organisation added.

Chancellor Alistair Darling lowered growth forecasts for 2009 in his budget two weeks ago, although Treasury hopes for the economy to expand by between 2.25% and 2.75% next year are well above the CBI's latest estimates.

Chief economic adviser Ian McCafferty said UK firms were in relative health after strong profits in recent years, but if banks' access to cash remained constrained, the impact was "as much a 2009 story as one for 2008".

"Rather than being a short sharp shock that would drive the UK economy close to, or into, recession in the near future, it is better thought of as a longer term headwind that will hold back any recovery until well into 2009, and limit the potential pace of growth of the economy for some time thereafter," Mr McCafferty said.

The CBI also warned the squeeze on consumer spending would be sustained for much of 2008 with disposable income under pressure from soaring energy and food prices, while wage settlements and earnings are not expected to rise in response. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

CBI Cuts Forecasts for Growth and Warns of Economic Gloom; the Slowdown Will Continue into Next Year
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.