According to the accountants and business advisers at BDO Stoy Hayward, UK economic growth is expected to grow stronger in the second half of 2006.
The report, which was included in the most recent BDO Business Trends report, shows that a there is an increase in business confidence both in the short-term and the long-term. There is an expected growth of 3.4 per cent for the third quarter of 2006. This is compared to the 2.4 per cent posted in the last quarter of 2005.
These positive numbers are likely to give tremendous benefit to the
UK economy especially later this year. Some of the other factors that have contributed to this upswing are the rebound in consumer spending, economic recovery in Europe and the fast rising value in the stock market.
The new report also showed that the expectations about UK inflation levels are actually falling. Inflation is being pegged to be at 2.2 per cent by the third quarter of 2006. Because of the expected strong showing of the economy and with inflation foreseen to go beyond the two per cent target of the Bank of England, it is most likely that interest rates will not be slashed this year – much to the disappointment of people who are clamoring for an interest rate cut.
Company formation and business solutions professionals are welcoming this developing trend, saying that the positive economic numbers will surely spur growth and might even entice people to start their own investments and businesses as a way of taking advantage of the conducive environment for business.
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