THE International Monetary Fund has cut its forecasts of UK growth for 2013 and 2014, as worries grow that the country is about to lose its coveted AAA sovereign credit rating.
In an update to its World Economic Outlook, published yesterday, the IMF reduced its forecast of growth in 2013 to 1%, from the 1.1% rate it had projected in October. And it cut its prediction of expansion in 2014 from 2.2% to 1.9%.
It trimmed its forecast for global growth in 2013 from 3.6% to 3.5%. And it now expects the global economy to expand by 4.1% in 2014, rather than 4.2%.
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The IMF's latest downgrades to its UK growth forecasts are a further blow for the Coalition Government, which has failed to achieve the economic recovery it had envisaged. Consumer confidence is weak, amid the Coalition austerity programme.
The continuing absence of meaningful recovery is fuelling concerns that the UK is about to lose the AAA credit rating it has held since 1978. A poll of 31 economists published by Reuters yesterday put the median chance of the UK losing its AAA rating in 2013 at 60%.
Expectations of a triple-dip recession in the UK have risen. Economists expect figures tomorrow to show a fall in output in the fourth quarter of 2012.