CBI Predicts End of Recession

Written by Becky on Monday 28 December 2009

The Confederation of British Industries (CBI) predicts that the UK will exit recession in the fourth quarter of 2009, partly due to consumer spending ahead of the VAT rise in January.

As a result, the UK’s leading business organisation predicts annual gross domestic product (GDP) growth of 2.5% in 2011, following 1.2% in 2010.

John Cridland, CBI Deputy Director-General, said:

“However, the economy will be on a fragile path of very slow growth, as we continue to feel the lasting effects of the financial crisis.

“Unemployment is expected to continue rising over the coming quarters, but peaking slightly lower than previously forecast, at just over 2.8m in 2010 Q3.

“Although the first few months of 2010 will be difficult, growth will gradually pick up and increasing confidence and demand will lead the UK into a more positive 2011.”

Growth Forecasts for the Economy in 2010:

  • 2010 will see a modest annual growth rate of 0.4%, rising to 2.3% in 2011.
  • Growth in the range of 0.5% to 0.7% is expected to be maintained through to the end of 2011.
  • Average earnings are expected to rise faster over 2011, at 3.9%.

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