Figures from the Office for National Statistics show growth in the Finance and Business Sector -.’The City’ - to be just 0.4 per cent for the first quarter of 2008.
The City is responsible for over 30% of UK output and has brought the whole economy to its own level - a far cry from Alistair Darling’s budget predictions of 2 per cent growth, followed by 2.5 per cent next year.
Confusion amongst analysts is driven by conflicting messages from the retail sector; consumers are fleeing the high street, yet in fact the spending downturn has not been as severe as predicted.
The IMF predicts UK growth at around 1.6 per cent, whilst comments from David Blanchflower of the Bank of England’s Monetary Policy Committee - they who set the interest rates - were that house prices could fall by 30% before stabilising.
Other pundits state there is currently a 1 in 3 chance of a UK recession during the next two quarters.
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