UK growth on the up, says British Chambers of Commerce

The UK will grow 0.9pc this year, 1.9pc the next and hit 2.4pc in 2015, according to the industry body, which raised its annual growth forecasts from 0.6pc, 1.7pc and 2.2pc respectively.

David Kern, its chief economist, said it was an unusual move: “I can’t remember any time recently where we upgraded all three years.”

He also believed the Office for National Statistics (ONS) could revise away the “double-dip” recession as soon as June 27, when updated growth figures are released. Currently the last UK recession – defined as two consecutive quarters of negative growth – hangs on two quarterly contractions of just 0.1pc each, reports The Telegraph.

The improvement in the forecasts was attributed to revisions to official economic data for last year, a stronger services sector and a pick-up in consumer spending as inflation keeps easing from its 5pc-plus peak in 2011.

In contrast, the eurozone economy is forecast to shrink in 2013, its second year of contraction in a row.

In terms of monetary policy, while Mr Kern said the Bank of England’s quantitative easing (QE) programme has supported the financial services industry, its benefits for the wider real economy were less clear – and said no more QE was necessary on top of the current £375bn programme.

Rather, the Government should focus on investment in infrastructure as a way of stimulating the economy, he said, arguing that this would not affect the fiscal mandate of eliminating the structural, or ‘built in’, deficit.

Mr Kern reiterated the BCC’s call for more support for exports – in particular for services, in which the UK has a trade surplus, rather than goods, in which there is a trade deficit.