UK economy is no Greek tragedy
Even though the Office for Budget Responsibility significantly reduced forecasts for UK economic growth in 2010 and 2011 thankfully there was a reiteration that the UK economy is no Greek tragedy. In reality the Greek economy has been storing up problems for many years now, indeed many EU members have highlighted this in the past, and the credit crunch and resulting worldwide recession literally tipped the country over the edge. So why is the UK any different?
The UK economy will not be experiencing the kind of budget cuts forced upon the Greek government even though there will be enormous public sector spending reductions announced by David Cameron. There is also the underlying strength of the UK economy, albeit weakened over the last couple of years, which will also see the UK budget deficit reduced sharper and in a more controlled manner than its Greek counterpart. However, that is not to say that the UK Triple-A rating will definitely remain in place in the short to medium term but even if there is a downgrade it is likely we will see a return to the goldplated rating in due course.
These comments will offer comfort to some of the U.K.'s struggling businesses and business leaders many of whom were concerned we were on the verge of a double dip recession.
Share this..
Related stories
Vauxhall jobs to go at Luton plant
While the Vauxhall plant at Ellesmere Port has been grabbing the headlines of late with relief that the 2500 jobs in the region are safe, there was bad news for the Vauxhall Luton plant today with the announcement of 350 job losses. GM Europe is currently in negotiations with workers and unions and it is hoped that the job losses will be fulfilled via voluntary redundancy amongst the 1500 workforc...
Read MoreProvident Financial cautious on UK economy
Sub-prime lender Provident Financial has issued a rather downbeat assessment of the UK economy after reporting profits of £54 million for the first half of 2010, down on analyst expectations of £57 million. While you would assume that in dire economic situation such as the one faced by UK consumers today, subprime lenders would benefit but this does not appear to be the case. It is becoming e...
Read MoreIrish economy in freefall
Despite comments to the contrary by the Irish government, the Irish economy would appear to be in freefall with startling figures showing a 7.5% reduction in the size of the economy towards the end of last year. While the fall in GDP for the whole of 2008 was a much lower 2.3%, there are serious concerns that short-term weakness and a lack of consumer spending could push the economy deeper and dee...
Read MoreWill we ever find a suitable regulatory system for the UK?
As the government issues yet another revamp of the UK regulatory system for financial markets there are serious concerns that the government's strategy is more short-term than long-term. By creating increased friction between the Bank of England and the Financial Services Authority (FSA), as well as bringing the Treasury in to oversee the system, there are great fears of turf wars within the regul...
Read MoreIs it right to limit salaries and bonuses in the City?
We have seen groups from all areas of society involved in the ongoing attack on the City fats cats, but is it right to limit salaries and bonuses in a free market, or does it undermine the ideals of a free market approach?
We have seen every political party having a go at the City and we have even seen the Church join the fray, accusing City fat cats of acting like 'bank robbers', b...