Chancellor admits recession could last two years

admin — Mon, 02 Mar 2009 12:57:13 +0000

The Chancellor of the Exchequer, Alistair Darling, has admitted that the recession that has gripped the UK could last as long as two years, stating that the downturn was likely to be far worse that had originally been anticipated.

Some time ago Darling had indicated that he thought the recession could be over by as early as the middle of this year, but his prediction has now changed, and he had admitted that the downturn is worse than he had anticipated.

The Prime Minister, Gordon Brown, also said that he had failed to see the financial and economic disaster coming, and said that there was little alternative other than to use taxpayer’s money to try and bail out the financial systems in the UK. However, Tory Party leader, David Cameron, said that Labour had now lost the confidence of the public and industry, and that this was vital in order to assist the recovery of the nation.

Cameron stated: ‘It is confidence that will be key to the recovery. We also have to get the Government finances under control, a proper plan for regulating the banks to make sure we have sensible policies so we get confidence back.’ Nick Clegg from the Liberal Democrats said: ‘My worry is we might be teetering between recession and slump if you get these major question marks raised about our currency and the viability of UK plc, the sustainability of our finances.’

When asked what his biggest mistake had been by the BBC the Prime Minister said: ‘We believed there was a possibility of institutional failure in the banking and financial system so we did all sorts of simulation exercises. But what we didn’t see – and nobody saw – was the possibility of complete market failure, that markets seized up across the world.’

Chancellor admits recession could last two years is a post from: Nicon Debt Management

Is the UK on the brink of recession?

admin — Wed, 25 Jun 2008 08:44:26 +0000

According to a recent report economic optimism in the UK has dropped to its lowest level in a quarter of a century, with a number of factors all pointing to the increasing risks of recession. Many are wondering whether the UK is heading the same way as the United States in terms of the economic downturn, and the matter has been made worse by the fact that for the past couple of months interest rates have been left on hold at 5% whilst borrowing costs, in many cases, have continued to rise.

A survey was recently carried out using over two thousand people, who were polled about their views over the economy. The resulted showed that pessimism about the economy hadn’t been this low since 1983. The UK is facing its worse housing slump since the dark days of the early 1990s, coupled with rising living costs, with petrol prices reaching record highs. In addition to this is the global credit crunch, which has seen the cost of borrowing rise and the availability of finance plummet.

The report has put additional pressure on the Bank of England to cut interest rates again. Whilst the central bank has cut rates three times since December of last year following five rate hikes between August 2006 and July 2007, it has since resisted calls to cut rates again, leaving the base rate at 5% in both May and June. The reason behind this is because of rising inflation levels, which have spiralled to a full one percent above the government’s target of 2%.

A survey from the Confederation of British Industry recently showed that prices on the high street have risen at the fastest pace since 1992, and the cost of food and other essentials has also soared, putting addition pressure on already strained household finances.

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Is the UK on the brink of recession? is a post from: Nicon Debt Management

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Chancellor admits recession could last two years

Is the UK on the brink of recession?