British economy forecast to grow above expectations

For the second time in three months, the International Monetary Fund (IMF) has revised its forecast of UK growth and now expects the economy to grow by 2% in 2017.

This makes the UK economy the second fastest growing advanced economy in the world after the USA, which is good news for investors.

Stating in its latest World Economic Outlook that UK growth had “remained solid” following the Brexit vote, the IMF also predicts that the global economy will expand by 3.5% in 2017 and 3.6% in 2018.

Maurice Obstfeld, the IMF’s economic counsellor, said:

“The global economy seems to be gaining momentum – we could be at a turning point.”

The challenge for the UK, according to the IMF, is to successfully negotiate new relations with countries in the European Union so that trade barriers are not raised, as these would have a negative effect on British business.

Discussing the Bank of England’s low interest rate of 0.25%, the IMF said this was necessary due to expected glow growth, but predicted that rates will now begin to normalise.

Although the IMF is optimistic about the UK and the world economy, it warned that there are risks from protectionism, excessive financial risk taking and the vulnerability of the Chinese financial system.

If the IMF forecasts are correct, this could mean that the stock markets will perform well for investors. Wirral residents who want to invest in the British or world economy should talk to Endeavour Financial Planning for the very best in an investment management.

Investments – The value of units can fall as well as rise, and you may not get back all your original investment.

Source: https://www.theguardian.com/business/2017/apr/18/imf-ratchets-up-uk-economic-growth-forecast-to-2