According to revised projections of the International Monetary Fund (IMF). IMF have successfully elated their predictions of UK growth by more than any other G7 economy, claiming that cheaper credit and increased buyer confidence has unexpectedly effected growth in an more positive way than originally expected.
It’s the first time since April 2008 that the UK economy is forecast to grow faster than the US or Germany, with growth now forecast at 2.9% for 2014, revised upwards from 2.4% in January and 1.9% last October. In comparison, the US economy is forecast to grow at 2.8%, Canada at 2.3% and Germany at 1.7%.
Olivier Blanchard, chief economist for the IMF, said:
“It is fair to say that our forecast was too pessimistic, and indeed growth has been much stronger than we had forecast. II think it has to be said that we are in the business of forecasting. Forecasting is an imperfect science and sometimes we over-estimate or under-forecast.”
The IMF also praised policies announced in Budget 2014 to boost capital spending, including doubling the annual investment allowance for businesses to £500,000.
However, it also warned that the UK’s recovery was “far from assured”, due to its unbalanced nature.