Daily Times

Britain’s economy looks on track to grow at its weakest rate since 2009 this year due to Brexit uncertainties, higher oil prices and fears of a trade war, the British Chambers of Commerce said on Monday. The BCC cut its 2018 growth forecast to 1.3 percent from 1.4 percent — in line with the average in a Reuters poll of economists published on June 7 — and also cut its outlook for 2019 to 1.4 percent.

“The economy is in a torpor, with uncertainties around Brexit, interest rate rises, and international developments such as a possible trade war and rising oil prices all having an impact,” the BCC said.

Britain was the slowest-growing among the G7 group of major economies at the end of 2017, and in the first three months of 2018 the economy expanded by just 1.2 percent year-on-year, its weakest since 2012. The Bank of England expects the economy to pick up after its weak start and achieve growth of 1.4 percent this year, rising to 1.7 percent in 2019 when Britain leaves the European Union.

But the BCC said the slow start to 2018 looked like it was down to more than just unusually icy weather, and added that the case was weak for a further increase in BoE rates, which most economists expect in August. On Friday, Germany’s Bundesbank cut its forecast for growth this year to 2.0 percent from 2.5 percent, blaming trade war fears and political instability in parts of the euro zone.

US President Donald Trump levied tariffs on imports of European steel and aluminium at the start of June.

Published in Daily Times, June 19^th 2018.