Economy 'no longer in free fall'
The chancellor is expected to revise his economic forecasts in the Budget. The economy is no longer in free fall and a recovery next spring is likely, a renowned economic think tank has said. Stabilising markets and the easing of credit conditions may well mean that the worst of the recession is over, The Ernst & Young Item Club said. It is forecasting the economy to shrink by 3.5% this year and by 0.1% in 2010.
But if you think everything is turning rosy read on to see what Peter Spencer, chief economic adviser to the Item Club has to say:
"We face another 12 to 18 months of serious grief. Around 900,000 jobs will be lost this year and half a million next," he said. He also predicted a gloomy next 12 months for the housing market and the high street. World trade is expected to decline by 9% in 2009, he added.
Still, if you work for the Beeb or the la-la land that is the government with guaranteed income for the next 2 years, you will believe all this.