The EC worsens its growth forecasts for the United Kingdom due to inflation

The European Commission (EC) today reduced its forecasts of economic growth for the United Kingdom to 1.5% in 2017 and 1.3% in 2018, the lower figures of the European Union together with Italy due, above all, to the higher consumer prices that have limited the increase in private consumption.

Brussels, 9 Nov (EFE). - The European Commission (EC) today reduced its forecasts of economic growth for the United Kingdom until 1.5% in 2017 and 1.3% in 2018, the lowest figures of European Union together with Italy due, above all, to the higher consumer prices that have limited the increase in private consumption.

The inflation rate in the United Kingdom has grown in the last year, driven by the depreciation of the pound sterling after the victory of "brexit" in the referendum last year.

The macroeconomic forecasts of autumn published this Wednesday contrasts with the spring ones, announced in May, when Brussels improved its estimate to 1.8% for 2017.

Now, the EC stresses that the GDP growth went from 2.3% in 2015 to 1.8% in 2016, and underlines that it has slowed down even more since the beginning of the year, with percentages of 0.3% in the first two quarters of 2017.

The Community Executive It attributes this contraction to the decrease in private consumption, derived from the lower real disposable income, since the increase in wages was below inflation.

In fact, the British inflation rate is one of the fastest growing in the European Union, to 2.7% this year and 2.6% in 2018, after remaining unchanged in 2015 and growing to 0.7% in 2016.

The Commission adds that "uncertainty continues to weigh on business investment", but admits that net exports are expected to support growth and the market labor force shows "continuous resistance".

Thus, Brussels anticipates that the unemployment rate in the United Kingdom will be 4.5% this year and 4.7% next, compared to 5% and 5%. announced in the spring forecasts.

Meanwhile, the public deficit will go from 2.1% in 2017 to 1.9% in 2018, so the procedure for excessive deficit to the United Kingdom It should be closed in the coming months.

In fact, at the press conference to present the forecasts, the European Commissioner for Economic and Financial Affairs, Pierre Moscovici, He expressed his hope that by 2018 all Member States will abandon the deficit procedure.

At present, only France, Spain and the United Kingdom are in it. United.

Moscovici also assured that the forecasts on the British economy were made with a "purely technical" approach and do not seek "to open any kind of speculation policy ", referring to the possible results of the" brexit "negotiation.

The British public debt will be 86.6% of GDP in 2017 and 85.3% in 2018.

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