A top British think-tank has upgraded it’s predictions for growth forecasts in 2018, with momentum from 2017 expected to continue this year.
The EY Item Club, which only a few months ago made dire predictions about the state of the UK economy, has released new figures following better than expected GDP growth of 1.8 per cent in 2017. As a result of these figures, economists at EY Item Club nudged up forecasts for 2018 to 1.7 per cent.
A let-up in the consumer spending squeeze and the chances of a near-term Brexit transition arrangement had improved the outlook for economy, according to the think tank. Both are expected to boost UK growth this year, along with falling inflation and higher company profits.
The Chief Economist from the think-tank, Howard Archer provided a sense of optimism by saying:
“The near-term prospects for the UK economy appear brighter, with GDP growth in 2018 being helped by the squeeze on consumers easing as the year progresses.”
However, he did say that that the uncertainty of brexit is an issue but “if a Brexit transition arrangement can be agreed early on in 2018, this would likely provide a boost to investment prospects over the year.”
These positive predictions of British outlook come as a welcome sign given the leaking of gloomy Brexit predictions last week and indicate that although there are issues in the economy, the worst appears to be over.