The UK’s economic outlook has improved significantly compared with twelve months ago and GDP growth forecasts have been revised up.
Notable revisions include that of the IMF which has upgraded its forecast for 2014 GDP growth to 2.9%. The Office for Budget Responsibility is forecasting growth of 2.7%, while the Bank of England has raised its forecast to an optimistic 3.4%.
The recent run of positive economic data has continued, with Q4 2013 growth reaching 0.7%, giving 1.7% growth for 2013 as a whole. The strongest growth was recorded in the services sector, although manufacturing and production have also started to pick up after a lengthy period of weak output.
Importantly, a number of key indicators specific to retail are now more upbeat. The official retail sales data for February provided a third successive month of robust retail sales. Sales volumes rose by 3.7% year-on-year, with non-food sales (+4.3%) easily outperforming food sales (+1.6%).
(This article features excerpts from the full report – please download it here)