The outlook for the UK economy: 2002 the weakest for a decade, but subdued recovery expected

Abstract

The outlook for the UK economy is reasonably positive, but the risks remain large. The global recovery appears to have stalled, creating continued uncertainty for the UK's trade-exposed sectors, such as manufacturing. At the same time, domestic demand is showing signs of slowing more rapidly than anticipated six months ago. In this environment, business propositions should be examined for vulnerability to the slowdown in consumer demand and the retail sector. Overall, however, UK economic activity remains well placed to pick up during 2003, with the labour market remaining robust and monetary and fiscal policy both accommodative. Therefore although growth in capital values is expected to moderate, it is likely to remain healthy. Copyright © 2003 Henry Stewart Publications