Best of the Week
Most Popular
1.Trump Delirium Triggers Stock Market Brexit Upwards Crash Towards Dow 20,000! - Nadeem_Walayat
2.The Future Price Of Gold Will Drop Below $1000 In 2017 -InvestingHaven
3.May Never Get Another Opportunity to Buy Gold at this Level Again - Chris_Vermeulen
4.Delirium - The Real Reason Why Donald Trump Won the US Presidential Election - Nadeem_Walayat
5.Why Nate Silver / Fivethirtyeight is one of the Most Reliable Election Forecasting Indicator? - Nadeem_Walayat
6.Gold Price Forecast: Nasty Naughty November Gold Price Trend - I_M_Vronsky
7.Gold Mining Stocks Screaming Buy! Q3’16 Fundamentals - Zeal_LLC
8.Delirium of Trump Mania Win's Mr BrExit US Presidential Election 2016 - Nadeem_Walayat
9.The War On Cash Goes Nuclear In India, Australia and Across The World - Jeff_Berwick
10.Hidden Signs for Gold and Silver - P_Radomski_CFA
Last 7 days
Trump Sets The Stage For A Huge Gold Rally In 2017 - 6th Dec 16
BrExit Tsunami Claims Emperor Renzi's Scalp, Counting Down to End of the EU, Next? - 6th Dec 16
Failed EU - Means an Expanded Dictatorship - 6th Dec 16
Crude Oil Prices: "Random"? Hardly - 5th Dec 16
The Coming Stock Market Crash and WWIII - 5th Dec 16
This Past Week in Gold Market - 5th Dec 16
Stock Market Short-Term Correction Underway - 5th Dec 16
If Trump Doesn’t Do This, We Will Have the Great Depression 2.0 - 5th Dec 16
India’s Demonetization Could Be the First Cash Domino to Fall - 5th Dec 16
Our Future Economy, Jobs, Banking, And Governance - 5th Dec 16
Gold and Silver Bullion Buying Opportunity for 2017? - 4th Dec 16
First UK BrExit then Trump, Next BrExit Tsunami Wave to Hit Italy HARD Sunday! - 3rd Dec 16
The 10YR Yield and SPX Stocks Bull Markets - 3rd Dec 16
Gold And Silver – Do Not Expect Much Difference With Trump Compared To Obama - 3rd Dec 16
Gold, Currencies and Markets Critical 61.8% Retracements - 2nd Dec 16
Gold Junior Stocks Q3’16 Fundamentals - 2nd Dec 16
Adventures in Castro’s Cuba - 2nd Dec 16
We Are Putting Off the Inevitable - 2nd Dec 16
Macroeconomic Cycles & Demographics - A Fuse, An Explosive and The Igniting Catalyst - 2nd Dec 16
How Moving Averages Can Identify a Trade - 1st Dec 16
Silver Prices and Interest Rates - 1st Dec 16
America, is it Finally time for us to say Goodbye? - 1st Dec 16
Blockchain Technology – What Is It and How Will It Change Your Life? - 1st Dec 16
Burn the Flags, Can Trump Salvage The Sinking US Economic Ship? - 1st Dec 16
Will US Housing Real Estate Market Tank in 2017? - 1st Dec 16
Referendum Puts Italy's Government to the Test - 30th Nov 16
Why We Haven’t Seen Gold Price Rally after Trump Victory - 30th Nov 16
Breakdown and Slide in Crude Oil Price - 30th Nov 16
A 'Wicked Rally' in Gold Price Predicted - 30th Nov 16
Silver Market Sentiment Looks Golden - 30th Nov 16
Indian Demonetization Denotes Severe Stress in the Global Gold Market - 30th Nov 16
Owning Gold and Silver in Troubling Times - 29th Nov 16
Trump's Presidency - Stock Market Crash or Start of New Mega-Trends - 29th Nov 16
Prime Minister Modi's War Against Corruption, Black Money and Fake Currency Notes in India - 29th Nov 16
Can President Trump Really Drain the Swamp? - 29th Nov 16
President Trump’s Economic Plan Isn’t Going to Work - 29th Nov 16
The US Bond Bear Market Has Begun! - 29th Nov 16
Simple Yet Powerful Technical Trading Tools - 28th Nov 16
Public Infrastructure – Welcome to the World of Waste, Fraud, and Abuse - 28th Nov 16
Fifty Years Later, Moore's Computing Law Holds - 28th Nov 16
An Elusive Stock Market Top - 28th Nov 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

$10000 Gold

UK Economic Growth Evaporating, Worse to Come than OBR Budget 2016 Forecasts

Economics / UK Economy Mar 17, 2016 - 05:10 AM GMT

By: Nadeem_Walayat

Economics

The governments fantasy projections on the economy made by their Office for Economic Propaganda (OBR) shortly following the Conservatives May 2015 election victory are fast unraveling as the OBR's latest propaganda nudged expected growth for 2016 lower to 2% from 2.4%, and growth for 2017 lower to 2.2% from 2.5%, whilst maintaining more distant year overly optimistic forecasts.


However, as per my recent analysis of the UK economy that despite today's revision lower, OBR GDP expecyatopms still have a lot further to fall before they come anywhere near to that which is likely to be most probable:

06 Feb 2016 - UK Interest Rates, Economy GDP Forecasts 2016 and 2017 )

UK Economy

The oil price collapse has triggered a huge transfer of wealth from England to Scotland to prevent a collapse of the Scottish economy following what will probably turn out to be the slow death of the North Sea oil industry which requires an oil price of approx $60 just to break even let alone the likes of $100+ to finance new expensive operations that the fantasy land Scottish Nationalists had propagandised during the 2014 Independence Referendum and delusionally continue to cling onto to this day when the truth is that Scotland's oil party is well and truly over!

Nevertheless the support for Scotland, a weak european economy and evaporating Chinese demand are all acting to drag down UK GDP to imminently a sub 2% rate. However, whilst a recession does not appear to be on the cards the slowdown in momentum is such that the UK looks set to dip to an annualised growth rate of below 1.5% and may even touch bottom at 1% which compares against the engineered mini-election boom of 2.8% in the run upto the May 2015 general election.

Therefore, as usually tends to be the case for post election economic slowdowns, then the next 2 years are likely to be weak (2016, 2017) with GDP probably going to average at a rate of about 1.6% for each year which compares against the Bank of England's economic propaganda expectations of 2.5% for 2016 and 2.7% for 2017.

Whilst the OBR's growth forecasts have today been revised lower to :

  • 2016 : 2.0% from 2.4
  • 2017 : 2.2% from 2.5
  • 2018 : 2.1% from 2.4
  • 2019 : 2.1% from 2.4
  • 2020 : 2.1% from 2.3

Therefore expect further revisions lower towards my forecast of 1.6% for 2016 and 2017, the consequences of which will be for far higher borrowing that will literally blow apart the Conservative governments fantasy expectations for a £10 billion budget surplus for 2020-21, which is just not going to happen as I earlier covered in UK Government Debt Propaganda Continues as OBR Revises Borrowing Higher,. (17 Mar 2016) as illustrated by the below graph.

For more on the UK economy and prospects for interest rates for over the next 2 years then see my recent in-depth analysis and accompanying video:

https://youtu.be/75y5aLczdy0

Ensure you are subscribed to my always free newsletter (only requirement is an email address) for the following forthcoming analysis -

  • US Interest Rates and Economy
  • US Dollar Trend Forecast
  • UK Housing Market Trend Forecast
  • Stock Market Trend Forecast
  • US House Prices Detailed Trend Forecast
  • Gold and Silver Price Forecast

By Nadeem Walayat

http://www.marketoracle.co.uk

Copyright © 2005-2016 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 25 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Housing Markets Forecast 2014-2018The Stocks Stealth Bull Market 2013 and Beyond EbookThe Stocks Stealth Bull Market Update 2011 EbookThe Interest Rate Mega-Trend EbookThe Inflation Mega-trend Ebook

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

R.E.B
17 Mar 16, 21:44
Real UK GDP?

What is the UK's real GDP? We all know that the way GDP is calculated is a joke. The biggest laugh of all came last year when the government announced they were including the illicit drug trade and the sex industry in GDP numbers. So while the statisticians sit around trying to guess how many wraps of smack changed hands last quarter or how many ladies of the night did X amount of business, something totally different happens in the real world. Also lets take out unproductive government spending too. So our debt to GDP ratio is probably sky high, but that only serves to reinforce your basic point that printing money is the only answer they have.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife