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UK economy looking healthy

05 April 2005
The UK economy is looking healthy despite some uncertainty about potential interest rates rises and the effects to business of the probable General Election in May.

According to BDO Stoy Hayward's latest Business Trends report, the second quarter of 2005 should see economic growth of about 2.9 per cent.

Despite shadows cast by a fall in business confidence in anticipation of the election, and the fact that this figure falls just short of the Treasury's target of a three - 3.5 per cent increase, BDO remains positive.

"Despite this, the economy continues to grow at a healthy pace with output up and inflationary pressures subsiding," BDO partner Chris Grove told

BDO did say it expected two interest rate rises by the end of the year, however, taking interest rates to 5.25 per cent.

However, the Sunday Times reported last weekend that a rise in oil prices witnessed at the end of last week was not likely to cause the Bank of England to hike up interest rates in the near future.

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