BusinessCompany NewsDeloitte study warns worst yet to come

Deloitte study warns worst yet to come

Despite government’s best efforts, the brunt of the economic fallout is yet to come, Deloitte warns

Deloitte
warnsthe brunt of the fallout from the credit crisis is yet to be felt, despite
the latest measures by the UK Government and other world jurisdictions to
recapitalise the banking systems.

‘Nonetheless, the bulk of the economic fallout has yet to be felt. The UK is
heading for a recession broadly similar in depth to that of the early 1990s,’
Roger Bootle, Deloitte economic adviser, said in the Deloitte Economic Review.

He said the recapitalisation of the banking system was unlikely to prevent a
major slowdown in the growth of bank lending to households and companies but in
the current environment, even if the supply was there, demand was unlikely to be
great enough.

The triple burden of plummeting house prices, flagging income growth and
soaring inflation would continue to bring down consumer spending growth,
contributing to further falls in company profits.

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