UK economy continues to go down
UK continues to sink along with most of their other European friends. The UK economy shrank at the fastest pace in Q4 2008 due to a variety of reasons.
First the housing prices reached record lows in 2008.
Unemployment levels were at record highs due to increasing closure of factories across UK.
Exports went into negative zone due to very low demand from US.
The recessionary trend is expected to continue at least till 2009 end.
The massive job losses that have happened over the last one year will show in terms of reduced demand for many products and services, which could lead to further job losses.
And with no certainity of retaining their jobs, people will be reluctant to commit any long term investment like housing etc. Reduced housing activity would be badly impacting most of the job intensive sectors like cement / steel / construction etc.
And UK is set for problem from another count also. It will see most of its tourism revenue coming down this year, because most of the US and other European citizens would postpone their foreign tour plans.
UK can get out of current problem, if and only, when you see a secured and thriving job environment. And dwindling interest rates are putting more strain on the aged people income. That segment is also likely to cut down their spends.
