Britain likely to slip into downturn amid crisis in Europe
10 Nov 2011
With a record trade deficit, rising unemployment and a sharp slowdown in shop price inflation, Britain, it is increasingly feared is slipping into another downturn as the euro zone debt crisis escalates.
The data that was revealed yesterday came after the Confederation of British Industry cut its forecast for UK growth for this year and the next.
According to analysts, the bad news is adding to the pressure on chancellor George Osborne to come up with a plan that would crank the growth engine and deliver his autumn budget statement to parliament later this month. He has however, already ruled out easing the pace of his austerity measures.
Concerns over a looming recession have prompted the Bank of England to resume its quantitative easing programme with a £75-billion pound cash injection last month. According to analysts, it would eventually have to pump in more stimulus, though not at this month's policy meeting.
According to official data, Britain's goods trade deficit widened to £9.8 billion in September.
Economists say that the numbers pointed to the crisis in the euro zone having hurt Britain's exports, even as they cautioned against interpreting the surge in imports as a harbinger of recovering domestic demand.
