UK economy to surpass 'pre-recession peak by summer'
British Chambers of Commerce expects the UK economy to grow by 2.8% this year
Monday 10 March 2014
The UK economy is set to surpass its pre-recession peak by the summer, according to a leading business lobby.
Upgraded forecasts from the British Chambers of Commerce (BCC) has predicted the UK will grow by 2.8 per cent this year.
The research forecasts that gross domestic product (GDP) climbed back to the level seen in the first quarter of 2008 in the second quarter.
The BCC predicted the pre-recession peak would not be reached until 2016 a year ago, although a number of revisions brought this forward to the third quarter of 2014 in December.
BCC director general John Longworth said: "Our economic recovery is gaining momentum. Businesses across the UK are expanding and creating jobs, and our increasingly sunny predictions for growth are a testament to their drive and ambition."
If the economy does return to pre-recession growth levels after six year it will allay fears of a lost decade of economic growth.
The BCC expects the first increase in interest rates will happen in the autumn next year - one quarter earlier than previously envisaged, before rising to 1.5 per cent in the second half of 2016. GDP will be 2.5 per cent next year and in 2016.
Longworth added: "Major issues remain, such as the unacceptably high level of youth unemployment. We urge the Chancellor to use this month's Budget wisely by incentivising businesses to hire young people so that the next generation of workers are not left behind.
"We just hope that as the general election gets closer, politicians are not tempted to abandon a drive for long-term economic security in favour of short-term vote winners.
"No government over the next decade can afford to get distracted - and our leaders must do everything in their power to ensure the economy goes from being merely good, to being truly great."
Additional reporting by PA
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