The UK economy [October 2006]

Across the globe world economic growth remains relatively strong despite a slight slowing in the US. Inflationary pressures are more clearly seen as a threat to prices as energy costs continue to grow. The general trend is for a tightening of monetary policy to combat inflation. The performance of the US, Japanese and Chinese economies have all stimulated world demand and trade. The Euro Area is forecast to pick up significantly as activity strengthens there. The only real concern there is the growth of German consumption. Emerging markets and other Far East economies also continue to perform well