Business surveys will be conducted on the United Kingdom’s service and manufacturing sectors for “clues on whether the UK risks a return to 1970s combination of stagnation and inflation.” Recent Middle Eastern events have created mumblings on concerns on global inflation. It seems that the UK is particularly vulnerable since there is no guarantee that it is really on the “sustainable road to recovery.” This is not necessarily the same for other European countries. Indeed, in 2010’s last quarter, the economy depleted more than in preliminary data had otherwise indicated earlier. This brings increased cause for concern over the future of the UK’s economy. As well, since oil prices are significantly on the rise, likewise inflation is due to increase at a way faster speed than was originally suspected which escalates risks to the UK and globally. Inflation is already high but the real issue is unemployment which has reached an all-time peak, 50% more than what it was in the 1970s. So the question that’s now being asked is will the economy grow (slowly, but still have an upward trend) or stagnate? Most predict (given this year’s figures) that it will indeed develop, if only due to the fact that the last quarter of last year was so poor, delaying work. But only time will tell over the next week or so if that trend is set to continue.
