Burgess: MPC growth forecast too optimistic

clock

The Monetary Policy Committee's forecasts for UK real growth are too optimistic, while concern mounts over its inaction in raising rates to stem rising inflation, says Threadneedle's Mark Burgess.

The CIO predicts a UK GDP growth of 1.4% for end of 2011, below the consensus forecast of 1.9%, due to tightening fiscal policy and real disposable incomes not rising for five years. Revised figures show the UK economy contracted more than previously thought in the last three months of 2010, shrinking 0.6% rather than the previously estimated 0.5%. "Inflation will be elevated and way above target for at least the next six months but our view remains that the MPC's and the market's outlook for real growth is still too optimistic," says Burgess. Inflation hit 4% in January, double th...

To continue reading this article...

Join Investment Week

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

Trustpilot