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Monday, November 28, 2011

Britain 'To Return To Recession' - 28th Nov 2011

Britain will return to recession next year, and will need to print more money, the Organisation for Economic Cooperation and Development has said.

In its semi-annual report on the outlook in its 34 member states, the international economic research group (OECD) said weak demand and fiscal consolidation has halted the recovery in the UK.

The OECD expects the downturn to be "modest", with 0.1% decline in output for the final quarter of this year and 0.6% contraction in the first quarter of 2012.

Six months, or two consecutive quarters, of negative economic growth indicate a recession.

The organisation also said the Bank of England should expand its quantitative easing programme to £400bn - effectively pumping a further £125bn into the economy by buying government bonds - to support growth.

It warned that unemployment could reach 9% by 2013, but that inflation would fall below the 2% target.

The Paris-based group also cut forecasts for the Euzone and the US and urged montary easing in other major economies. Read More