The UK economy’s initial recovery from recession has been much faster than expected, according to the EY ITEM Club’s Autumn Forecast, but future growth prospects have been downgraded.
In its latest forecast, the EY ITEM Club says GDP likely grew around 16-17% q/q in Q3 – much faster than the 12% growth predicted in July’s Summer Forecast – but growth of 1% or less is expected in Q4, while the growth forecast for 2021 has been lowered from 6.5% to 6.0%.
After Q3’s boost, the EY ITEM Club now expects the economy to contract 10.1% in 2020, an improvement from the 11.5% contraction forecast in the Summer.
The strong Q3 performance was driven by consumer
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