Is the UK Finally Out of the Recession?

Written by on November 13, 2012 in Money - No comments | Print this page

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The UK, and indeed much of Europe, has been living through a period of recession for years now. On October 25th figures were released which show the recession is finally over, or at least for the time being. The GDP went up by 1% in the last quarter, which is not a massive rise but nonetheless far more than was expected and was at least a rise rather than another fall. Celebrations were rife amongst government officials and financiers across the nation, but what exactly does this figure mean?

GDP and How it Affects the Individual

GDP is the acronym for Gross Domestic Product. It is a measure of a particular country or nation’s economic prosperity. It is worked out from the market value of all legally recognised finished goods and services that are produced in a certain time frame in a particular country. While it does give a pretty clear indication of how well the economy as a whole is doing, it means very little to the individual. Wages are expected to grow at a slower than average rate over the next five years while the cost of living will continue to rise. However, as Britain claws its way back out of the recession benefits will eventually filter down to the everyman.

Will Figures Continue to Rise at a Similar Rate?

Unfortunately at this stage indications show that the rate of inflation in the GDP will more than likely be less in the next quarter. The reasons for this are that the economy was given a massive boost last quarter by the Olympic Games. Ticket sales alone are said to count for 20% of the rise, and it has yet to be calculated how much related businesses benefited. Hotels, restaurants, shops and other businesses all reported higher earnings in the period the Olympics were being shown so this will also have boosted the GDP. Production and manufacturing are on the way up though, so perhaps the figures will continue to grow at a steady rate. European stock markets and the value of the British pound rose upon release of this news, which is a sign that things could continue to improve.

Cameron’s Slip-up

Prime Minister David Cameron let slip a statement on Prime Minister’s Question Time the night before the results were announced in which he stated that “the good news will keep coming” for the British economy. Certain senior government officials are allowed access to figures such as these a full twenty-four hours before the general public on the proviso that they keep them secret. Cameron is now being investigated to find out whether or not this constitutes a breach of secrecy.

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