Posts Tagged ‘UK’

With the UK economy now in a deeper double dip recession than most expected coupled with the ongoing challenges around the Eurozone, it is evident that while we enjoy the peak performances of athletes in the Olympics and Paralympics, our economy is far from growing or healthy. Against this background we take a look back at how our economy has struggled this year, what factors we might expect to impact our marketplace in the future, and what the uncertainty in Europe could mean for us. We also explore the ways in which you can protect and boost your business during these unstable times.

Looking back

A lot has happened in the last  six months, and since our last update the UK economy has experienced some major challenges. Most notable was the country’s return to recession, after preliminary GDP figures shrank further in the first three months of 2012, and continued to contract by an alarming 0.7 per cent in the second quarter.

On a positive note, inflation has been falling steadily from its peak of 5.2 per cent in September last year and CPI now stands at 2.4 per cent – the lowest it has been since 2009. This ‘pleasant surprise’ could provide some small respite for household budgets, while the Bank of England continues to extend its quantitative easing programme, which at the end of July stood at £375 billion.

March’s Budget saw the Chancellor deliver a series of measures in a bid to placate both households and businesses alike. Most popular measures included a rise in the personal allowance, which will increase from £8,105 this year to £9,205 in April 2013; and an accelerated corporation tax cut to 24 per cent, which was welcomed by businesses.

Finally, we cannot ignore the uncertainty that has been hanging over the Eurozone. The recent news of Germany’s rating evidences the severe strain being placed on one of the strongest of the Eurozone members. Will Greece bow out of the Euro? And if it does, what impact will this have on us? What will be the ramifications of Spain’s financial dilemma? The next six months will certainly be interesting, as we wait to see what fate awaits the Eurozone.

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