IMF Could Upgrade UK Growth Forecast After April Downgrade

The International Monetary Fund (IMF) could be forced into an embarrassing U-turn this week and upgrade growth forecasts for the U.K, analysts said on Monday.

“It seems highly likely that they will revise growth up,” George Buckley, chief U.K. economist at Deutsche Bank, told CNBC on Monday.

The IMF downgraded its growth forecasts for the U.K. in April over concerns about the austerity program headed by the country’s finance minister, George Osborne, sparking a war of words between the minister and the organization.

The IMF’s chief economist, Oliver Blanchard, told Osborne he was “playing with fire” and should “consider adjustment to the original fiscal plans.” Osborne responded by saying there was “no plan B for the U.K. economy” and that he would stick to implementing billions of pounds worth of spending cuts.

The IMF predicted the U.K. economy would grow by 0.7 percent this year and by 1.5 percent in 2014 – cutting both forecasts by 0.3 percentage points.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza