CBI warns return to health will not be so speedy

Jun 15 2009 By Karen Dent, The Journal

THE CBI is warning the UK’s return to health will be "slow and gradual" and said it did not expect economic growth until the start of next year.

The business lobby group said some commentators had been too quick to seize on recent positive indicators as evidence of green shoots in the economy.

CBI director general Richard Lambert said it will take some time before the UK can be sure those shoots have "roots we can depend on" for sustainable growth.

His organisation predicts that GDP, supported by low interest rates, will flatten out during the second half of 2009, followed by modest quarter-on-quarter growth of 0.1% and 0.3% in the first two quarters of 2010.

By the end of the recession, the CBI believes the economy will have shrunk by a cumulative 4.8% – not as severe as the 5.9% seen in the early 1980s.