UK Business leaders have echoed the thoughts of some property professionals by warning recession is looming and calling for a cut in interest rates.
The British Chambers of Commerce (BCC) delivered a gloomy quarterly report in which it warned there was ‘distinct possibility’ of a recession.
Officials also warned unemployment is likely to increase by some 250,000 to 300,000 over the next two to three years.
BCC economic adviser David Kern said:
“There is now a distinct possibility of technical recession. Over the next two or three quarters, we expect UK GDP growth to be slightly negative or zero.
“Thereafter, we expect a shallow recovery, but the period of weak, below-trend, growth is likely to be prolonged, lasting until the final months of 2009 or early in 2010.”
UK interest rates have remained unchanged by the Bank of England for the last four months, prompting the BCC to demand a reduction to aid growth.
BCC director general David Frost added:
“The longer the monetary policy committee waits before cutting rates, the bigger the danger the economic situation will deteriorate.”
Last month Smartnewhomes managing director David Bexon described the decision to again hold rates as ‘ludicrous’.
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