General review [October 1975]

At present it is difficult to form a generally agreed view on what has happened during the last six months to the world economy. It is impossible to establish an agreed view of what will happen in the next six months. The debate and the uncertainty centre round the current recession in world trade. There is no argument that the current recession is the most severe to be experienced since the last war. The problem lies in forecasting how and when recovery will take place. In the last issue of the Commentary (July 1975 page 12), we pointed out that, while the UK had so far postponed the necessary internal adjustment of the economy, it could not expect to escape it. This prediction has now been confirmed by the fall in GDP in the second quarter of 1975