Economic growth in the UK is expected to held back in 2012, despite a possible solution to the eurozone crisis, according to a report by the National Institute of Economic and Social Research.
Britain's economy is on the verge of a recession to be felt in 2012 and the economic think-tank expects the slowdown to continue, even if the eurozone crisis passes, Reuters reported. The NIESR has also revised GDP projections for the country to 0.9 percent for the current year and 0.8 percent for 2012, as against earlier predictions of 1.3 percent and 2.0 percent respectively. This is in spite of better-than-expected GDP growth in the third quarter of 2011. Weak domestic demand and the eurozone problems are blamed.
The NIESR report bases its predictions on a possible solution to the eurozone crises and is not ruling out a 70 percent probability of the UK falling back into recession if the problem worsens. In addition, the NIESR also expects a rise in unemployment to 8.9 percent by the end of 2012. As of now, unemployment figures in the UK are at a 17-year high, according to official statistics.