Households to be worse off in 2008
January 22, 2008 by admin
Filed under News, News-Loans
Households will be financially worse off in 2008, according to Ernst & Young ITEM Club’s latest forecast for the UK economy. 
The research, using the Treasury’s own economic model, describes public finances as a “mess” and anticipates the situation to get worse with slower growth and slower tax revenues predicted.
Speaking to the Independent, Peter Spencer, chief economic adviser to the ITEM Club, said: “Now that the economy is slowing sharply, the public finances will deteriorate equally rapidly.”
He added: “We have revised our forecast of this year’s current deficit up to £14 billion, compared with the Treasury’s pre-Budget report forecast of £8 billion.”
Experts have predicted that the Bank of England will cut interest rates at least three times to 4.75 per cent, or to a figure even lower, from the current 5.5 per cent over the course of the year or by 2009 if the economy continues to slow.
Meanwhile, research from property expert Right move shows that house prices are rising at their slowest rate for two years.
