Could problems in the Eurozone hamper the UK economic recovery?
While officially the UK economy moved out of recession in the final quarter of 2009 there are concerns as to whether the 0.1% increase in economic activity will be downgraded in the short term. On the back of this we now have significant issues within the Eurozone with the Greek economic collapse set to spread to areas such as Spain, Portugal and possibly elsewhere. There is growing concern that while the UK economy is certainly heading in the right direction, problems in the Eurozone could hamper or derail the UK economic recovery.
At this point in time it seems as though the worldwide economy takes one step forward and two steps back and this latest setback within Europe will cause major concern in the UK halls of power. Even though the UK government has yet to formally adopt the euro as the official currency of the UK there were concerns that the introduction of Lord Mandelson to the mix was a precursor to a formal adoption and transfer to the euro. However, over the last few days the euro has been in freefall amid concerns about how sympathetic the European Union as a whole is to the Greek economic collapse. Initially the signs were good with European Union members apparently singing from the same hymn sheet and keeping the party line. However, the last few days has seen a significant shift in the opinion and the attitude of countries such as Germany which have a massive influence over European Union policy.
Share this..
Related stories
Tories now getting tough on the economy
After months of mocking from the Labour Party about "secret" Tory policies regarding the UK economy, Shadow Chancellor George Osborne has today stepped forward with a raft of promises from a potential incoming Conservative party government. He has set out eight transparent benchmarks which he believes will allow the UK electorate, investors and businesses to monitor the progress he hopes to make i...
Read MoreInterest rates hold
The Bank of England has held interest rates at 5.75 per cent for a second month running. Analysts and commentators had widely predicted the freeze, based on a sharp fall in inflation in July to 1.9 per cent from 2.4 per cent in the previous month, as well as a desire not to exacerbate fears of credit squeeze. Just over a month ago, many experts were sure that interest would be lifted to six per c...
Read MoreIMF changes opinion on UK economy
The International Monetary Fund (IMF) has today issued a change in opinion with regards to the UK economy with a suggestion that recovery will happen sooner than previously expected. While the IMF is of the opinion that GDP (gross domestic product) will fall by a worse than expected 4.2% in 2009 (against a former estimate of 4.1%) the news in relation to the economy as a whole is much more upbeat....
Read MoreGovernment U-turn on post offices
The government has intentionally leaked plans for the UK Post Office network to the press this week amid signs that a massive U-turn is underway. After initially looking to downsize the Post Office, sell-off the more profitable areas and withdraw from many local communities, Lord Mandelson is believed to be pushing ahead with new plans to make the UK Post Office network a "mini community bank". So...
Read MoreWhen will the pound stop falling?
There are many investors in the UK dismayed at the fall in sterling which today touched as low as $1.537 in early trade against the dollar, although there are as many UK investors with overseas assets who welcome the unexpected bonus!
However, as the UK economy sinks deeper and deeper into the mire there are real concerns about the future of sterling which has fallen from $2 to the...