Commenting on the 4th quarter UK GDP figures published today, KPMG Chief Economist, Andrew Smith, said:
“Under any other circumstances, confirmation that the economy has essentially flat-lined for over a year and remains some 4 percent below the peak of 2008 would have raised expectations of an expansionary budget in March.
“But while it looks likely that the Chancellor will come under increasing pressure to revisit the deficit reduction plan, he will be unwilling to countenance further changes to fiscal policy after the revisions to borrowing announced only last November.
“With the outlook for demand bleak in the face of public spending cuts, declining real wages, rising unemployment and depressed European export markets, the onus remains on expansionary monetary policy. The latest MPC minutes do nothing to dispel expectations of a further tranche of quantitative easing in coming months.”
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Notes to editors.
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.