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The UK Economy

Published online by Cambridge University Press:  26 March 2020

Garry Young
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Extract

The UK economy now appears to be progressing along a path that is just consistent with the economic objectives of the government. Inflation is currently slightly above the 2½ per cent target, but stands a reasonable chance of meeting it by the end of the year. Government borrowing in the most recent financial year was above expectations, but could still satisfy the Maastricht fiscal criterion next year without further tax cuts. The government does not have an explicit, quantitative objective for economic growth, but this too is broadly acceptable at a current rate of expansion of 2 per cent per annum. Fears of an early recession now appear to be disappearing and growth looks likely to improve over this year and next.

Type
Articles
Information
National Institute Economic Review , Volume 156 , May 1996 , pp. 8 - 27
Copyright
Copyright © 1996 National Institute of Economic and Social Research

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Footnotes

∗

The forecast was compiled using the latest version of the National Institute Domestic Econometric Model. I am grateful to Nigel Pain and Martin Weale for helpful comments and discussions and to David Poulizac for his help with the database and charts. The forecast was completed on May 3rd 1996, some subsequent information is incorporated in the text.

References

Notes

(1) House of Commons Treasury Committee, ‘The 1995 Budget: The Government's Response To The Third Report From The Committee In Session 1995-96’, para 65.