摘要:

In October we forecast 1 per cent output growth in 1993 accompanied by little change in retail price inflation, an increase in unemployment to 3.2 million by the end of the year and a £20bn deficit on the current account of the balance of payments. Since then we have revised our view of the international outlook and the Chancellor has made his Autumn Statement. There are also some hopeful signs in the latest data on retail sales, manufactured exports and the money supply that demand may be picking up both domestically and overseas. How do these developments affect our short‐term forecast? The simple answer is very little: the outlook on output and inflation in 1993 is barely changed since October (Table I).We have lowered our forecasts for world inflation and for German interest rates which means that the pound can be held steady against the DM at lower UK interest rates and that the inflationary consequences of devaluation, though significant, are slightly less over the medium term than we made out in October. There is one revision of major significance, and that relates to the PSBR, which is now likely to reach f45bn in 1993‐4, more than 7per cent of nominal GDP. The change is not on the spending side ‐ the Autumn Statement confirmed existing expenditure plans ‐ but on revenues, notably corporate taxes and tares 011 spending, which have fallen far more quickly than we envisaged. This, in combination with a projected near‐2'per cent of GDP deficit on the balance of payments, poses a difficult medium‐term policy dilemma. To escape from the twin deficits requires either deflation of demand, which conflicts with the Government's new‐found commitment to growth, or a more buoyant economy to boost tax revenues and a competitive pound to underpin export‐led growth. Of the two the latter is self‐evidently more inflationary. This highlights the policy dilemma: at some stage the Government may have to choose between reducing the deficits and its 1–4 per cent inflation target or sacrifice its

ISSN:0140-489X    

DOI:10.1111/j.1468-0319.1992.tb00300.x

出版商:Blackwell Publishing Ltd    

年代:1992

数据来源: WILEY