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23/12/2009
Economy 'to remain sluggish' |
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The UK economy will continue to be weak as a number of factors collude to prevent it growing with much speed, an expert has predicted.
UK economist at BNP Paribas Alan Clarke predicted that the economy will "never really properly get going because you have got the overhang of the financial crisis and the brakes coming on from fiscal policy".
Such a situation could mean that those whose companies are struggling and may have pinned their hopes on an economic resurgence will instead need to see an insolvency lawyer.
However, Mr Clarke predicted that the Bank of England's response to higher taxes and slow growth will be to keep interest rates at their current low level through 2010 and 2011.
This may help some enterprises by keeping down the cost of their borrowing.
Mr Clarke made his comments after the Confederation of British Industry (CBI) predicted that the UK will come out of recession in the current quarter, with 0.5 per cent growth.
However, Britain's gross domestic product will only rise by 1.2 per cent next year, the CBI forecast.
Written by Anna Norton
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