Forecasts imply a robust acceleration in UK economy

Forecasts for the UK economy are starting to look overambitious.

Although 1%-1.5% for 2010 may not sound aggressive, it does imply a robust acceleration. Forecasts for 2011 and beyond assume a rapid return to ‘normal’; memories of a near-death experience seem short. The Government has plainly run out of cash, notwithstanding the absurd assurances from politicians big chunks of spending are somehow ring-fenced. For households, the unusual combination of circumstances that funded resilient consumer demand even while the savings ratio recovered is now largely reversed. The inventory cycle may be bottoming out but there is little incentive for companie...