Comforting signs for UK economy, bank deputy governor says Go compare with our comparison table

Comforting signs for UK economy, bank deputy governor says

21 December 2010 / by Paul Dicken

There are comforting signs for the UK economy but normality could be some way off, a deputy governor of the Bank of England has said.

In a speech on 13 December, Charles Bean, deputy governor for monetary policy, said economic prospects in the UK depended on private domestic demand and rising net exports, as the economic contribution of government spending reduces.

“While the outlook remains highly uncertain, the improvement in both financial markets and in the real economy since mid-2009 is likely to have contributed to the modest recovery seen in businesses’ capital spending over the past year,” he added.

Bean warned that peripheral European countries needed to carry-out structural reforms in the face of financial challenges to restore their competitiveness without the option of devaluing their currency.

He said the risks to UK banks from exposures to troubled European countries were limited due to improved ‘resilience’ in financial institutions; however, the interconnected nature of European banks could cause some adverse issues and affect credit supply.

In data published on 13 December the Organisation for Economic Co-operation and Development (OECD) predicted economic activity in most developed economies would stabilise going into 2011.
 
The OECD said growth prospects varied across major economies but there were some tentative signs of ‘convergence in economic cycles’ in many countries.

The OECD predicts regained growth momentum for the United States with stable growth predicted for countries in the Eurozone.

The organisation's economic survey of the Euro area forecast annual growth of 1.5 per cent to two per cent over the next two years.

It said the severe recession and the sovereign debt crises that have followed were the first major tests of the ‘robustness’ of the Euro area in a downturn.

The OECD is recommending governments improve discipline when it comes to public spending, step-up financial regulation and implement reforms to boost growth and competitiveness to overcome the large imbalances that have built up in economies.

The composite leading indicators – which use data to predict turning points in business cycles – predicts a slowdown in the fast-paced activity seen in Brazil, and a downturn in economic activity levels in India. The OECD indicators, meanwhile, point to expansion in Russia going into 2011.

© Fair Investment Company Ltd

 Product NameISA OptionIncome YieldMore Info
Income Maximiseryes
See Details
More Info >
Seeks to achieve a target yield of 7% to generate a quarterly income, whilst offering the potential for some long-term capital growth. Save 100% on Initial Charges.
Monthly Income Plus Fundyes
See Details
More Info >
Popular monthly income fund that aims to achieve a high level of income whilst seeking to maximise total return through investing in high yielding corporate and Government bonds, together with UK equities. 100% discount on initial charges.
Click here to view latest Fund Facts »
Strategic Bondyes
See Details
More Info >
Investing in higher yielding assets which will include most types of fixed interest securities, this fund aims to deliver a quarterly income to investors. Save up to 97% on Initial Charges.
Invesco Perpetual Corporate Bond Fundyes
See Details
More Info >
This highly popular investment fund aims to achieve a high level of overall return with relative security to capital. Income Paid to you twice yearly. Up to a 100% Discount off the Standard Initial Fund Charge.
Click here to view latest Fund Facts »
Artemis Income Fundyes
See Details
More Info >
One of the leading UK Equity Income Funds. The Fund managers hunt out companies with strong free cash flow and solid balance sheets. Income is paid to you twice yearly. 100% Discount off the Standard Initial Fund Charge.
Click here to view latest Fund Facts »
Invesco Perpetual High Income Fundyes
See Details
More Info >
One of the UK's most popular income funds, the Invesco Perpetual High Income has delivered consistently good long term returns through a variety of market conditions. Income is paid to you twice yearly. Up to a 100% Discount off the Standard Initial Fund Charge.
Click here to view latest Fund Facts »
M&G Corporate Bond Fundyes
See Details
More Info >
The M&G Corporate Bond Fund is a conservative ‘blue chip’ sterling fund that aims to produce a higher return than UK government bonds. Income is Paid to you Quarterly. 100% Discount off the Standard Initial Fund Charge.
Jupiter Merlin Income Portfolioyes
See Details
More Info >
The Jupiter Merlin Income Portfolio fund aims to achieve a high and rising income with some potential for capital growth. Income Distributions are made to you quarterly. 95% Discount off the Standard Initial Charge.
Click here to view latest Fund Facts »
The value of investments and any return from them can fall as well as rise and you may not get back the full amount invested. Please ensure that you read the Important Risk Information below.