The UK economy [January 2001]

Ireland, John (2001) The UK economy [January 2001]. Quarterly Economic Commentary, 26 (1). pp. 14-17. ISSN 0306-7866

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Recent events in the US have heightened fears that the continuous expansion of the UK economy since 1992 may be put in danger. Some commentators have revised their forecasts of GDP growth downwards and there is a general expectation that the next change in UK interest rates will be downwards. However, the likely impact of a US downturn on the UK will be relatively small. GDP growth remains strong at 3.0% in the four quarters up to 2000 Q3, although there are signs that industrial production and manufacturing output are slowing. Inflation as measured by RPIX is currently beneath the Government's inflation target and is expected to remain so during 2001. The ILO unemployment rate was 5.3% over the three months between September and November 2000, unchanged from the previous three months.