British economy will continue to flourish, predicts research

Britain’s economic recovery continues to flourish, according to new economic forecasts from the British Chambers of Commerce (BCC) and the National Institute of Economic and Social Research (NIESR).

Both forecasts indicate that the UK’s economy is rebounding from a disappointing fourth quarter in 2014. This news will be welcomed by the Chancellor ahead of this year’s budget announcement next week.

NIESR has indicated that the UK economy grew by 0.6 per cent between December and February. While this is a slight decrease when compared to the institute’s forecast for November to January, it does indicate a positive start to 2015.

Further support came from the BCC on Tuesday night, where a growth of 0.7 per cent for the first quarter of 2015 is anticipated.

“Businesses up and down the country are doing well despite international and domestic uncertainty,” said John Longworth, the BCC’s director general.

The positive outlook for the UK economy is not just restricted to the first quarter. The BCC has upgraded its projections for economic activity for the whole of 2015. Growth forecasts have been raised to 2.7 per cent for 2015 and 2.6 per cent in 2016.

Stronger than expected consumer spending helped lift these projections. However, Mr Longworth pointed out that more needed to be done to boost business investment and exports, which would create a more balanced economy.

It will be food for thought ahead of the much anticipated budget announcement and the general election in May. Businesses, particularly SMEs, will be looking for further tax breaks in the coming budget and for changes to be made to regulations as a result of the general election.

“The next government must be measured on whether it helps to boost business investment and supports improvements in the current account,” explained Mr Longworth.