Ernst & Young refutes Treasury's forecast for recovery

Britain is likely to see an export-led economic recovery going into 2011, but the economy will continue to suffer for the rest of this year, according to the spring forecast from the Ernst & Young ITEM Club.

Ernst & Young says this forecast conflicts with that of the UK Treasury, which has based its own predictions for economic recovery on the housing market and consumer spending on the high street, rather than on exports. The ITEM Club report says the strengthening of exports this year reflects improvement in world output and trade, building on a rebound at the end of last year. Exports and other sources of overseas income will help steer the global economy into a recovery phase, led by Asia and the US, the report adds. Pete Spencer, the chief economic advisor to the ITEM Club, says: "Th...