OECD cuts UK economic growth
Influential think tank, the Organisation for Economic Co-operation and Development (OECD) has today revised its growth for the UK economy, as a result of the Coalition Government’s austerity measures, designed to bring down the budget deficit.
However, the revision comes as no surprise as experts have been predicting that the harsh spending cuts will undoubtedly hamper growth.
The Paris-based organisation said it expects GDP of 1.8% this year – slightly higher than its May forecast of 1.3% but it now expects growth of 1.7% in 2011 against an earlier forecast of 2.5%.
It comments: “The pace is set to slow, however, as contributions from stockbuilding fade and fiscal consolidation creates increasing headwinds.”
The situation in the euro zone is similar, with the think tank forecasting growth of 1.7% this year and next, while rising to 2% in 2012.
Again, this is due to the tough measures introduced by economies within the euro zone.