Scottish economic growth to slow
Bank of Scotland predicts a slowdown in growth.
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Tuesday, 31, Aug 2010 01:44
By Chris Malone
Business investors may be interested to hear that the Bank of Scotland predicts a slowdown in the growth of the Scottish economy later this year.
The lender's research points to a reduction in the speed of the economic recovery in the fourth quarter of 2010.
Its Index of Leading Indicators predicted that the peak of growth may have already occurred in July.
Part of the problem is that historically low interest rates have yet to properly stimulate house building activity, while consumer confidence remains low, with a reluctance to purchase big-value items such as cars.
Bank of Scotland chief economist Donald MacRae explained that growth stalled for three months after Scotland emerged from the recession at the end of last year.
However, the Bank of Scotland PMI showed that the country's private sector has now experienced 13 months of growth since July 2009.
"This latest update of the Index of Leading Indicators shows the tentative recovery slowing in autumn as both consumer and business confidence continue to be dented by widespread concerns over the effect on jobs and contracts of future cuts in government spending," he added.
In other news, Bank of England deputy governor Charles Bean recently presented a paper on the lessons learned from the financial crisis.