IMF reduces UK growth forecast to 1.1 per cent down from 1.5 per cent
22 Sep 2011
In the UK, panicky chancellor George Osborne is drawing up an emergency Plan B to pump £5 billion into the flagging economy. This comes as a major U-turn by the Tory-led government, with the jittery chancellor now looking to step up spending on major projects to avert a double-dip recession.
The chancellor discussed the emergency plan with the cabinet as the International Monetary Fund yesterday cutting forecasts for the economy's growth.
According to the IMF, the UK economy would grow by just 1.1 per cent this year, down from its previous estimate of 1.5 per cent and well below the Treasury's own prediction of 1.7 per cent.
According to the forecast growth could be only 1.6 per cent next year down from the earlier prediction of 2.3 per cent sparking a serious double-dip recession risk.
The IMF called for a halt to Osborne's austerity programme if there was no improvement.
The IMF, now with France's Christine Lagarde as managing director said the eurozone debt crisis coupled with the political turmoil in the US threatened another world economic downturn.
