Harrison cautious on growth forecasts

Threadneedle head of UK equities Leigh Harrison remains cautious in his long-term view of UK equities despite recent improvements in growth.

Harrison says data has confirmed the recovery is now underway, while the Purchasing Managers' Index, traditionally a good leading indicator of activity in this cycle, points to a further improvement in growth over the next few months. However, he believes deleveraging will hamper demand going forward while consumer hunger for credit remains low and banks are unwilling to lend. "Despite this encouraging near-term outlook, we remain cautious in our longer-term views and below consensus in our growth forecasts," Harrison says. "De-leveraging at the government, corporate and consumer l...