The economy of the United Kingdom is said to contract by 1.3 percent in the year 2012 according to economists from the Standard Chartered Bank. This same institution has previously forecasted a 0.6 percent economic growth for the country for the next year.
The eurozone will be at a much worse case next year at 1.5 percent decline for 2012.
The Organization for Economic Cooperation and Development has predicted through their extensive analysis that there will also be a decline in the economies of many major countries all over the world during the year 2012. Most of the countries will fall below their long term economic average by next year.
The Office for Budget Responsibility said that the UK economy will increase by 0.9 percent in the year 2012. The Treasury conducted surveys that showed economic growth of up to 2.3 percent for the incoming year.
According to Thomas Costerg from the Standard Chartered Bank, “We think there will be a triple shock to the European economy. The first being a confidence crisis, consumers spend less, businesses invest less. The second is that banks are tightening credit owing to the credit squeeze and the third is national governments tightening budgets all over Europe.”
These shocks will be the main cause of rapid recession in the eurozone as well as the United Kingdom, says Mr. Costerg.
In a more positive light, Standard Chartered Bank said that the world economy will possibly grow by 2.2 percent in the year 2012.