The Confederation of British Industry, representing 240,000 businesses, has said it expects UK economic growth to slow in the second half of this year as the impact of improved business and consumer confidence starts to ease.
The economy grew by 0.8% in each of the first two quarters, but the CBI predicts a decline to 0.7% in Q3 and 0.6% in Q4. Its growth forecasts for 2014 and 2015 are unchanged at 3% and 2.7%.
However, CBI director general John Cridland said
The UK’s recovery is on solid ground, with our quarterly growth on average outstripping G7 competitors over the last year.
For the rest of this year, we expect growth to get on to a more even keel and the recovery to become further entrenched next year.
The CBI added that the “continued weakness of productivity and slow wage growth” had also led to an easing of momentum but it expects average earnings to pick up, with growth of 1% expected this year and 2.4% in 2015.
