UK economy showing modest signs of growth

In the past couple of months Britain has lost its AAA credit rating from both Moody’s and Fitch.

The news was not unexpected given the weak performance of the UK economy over the past two years and its persistently high budget deficit. Furthermore, the weakness of the economy has now started to push the government’s fiscal tightening programme off track.

Essentially, the UK economy has been flat over the past two and a half years. However, there have been some signs of modest growth so far this year. GDP increased by 0.3% in the first quarter of 2013, reversing the 0.3% fall in the final quarter of last year. GDP in the first quarter was also up by 0.6% on year earlier levels.