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MNI (London)
--WEO Sees UK 2018 Growth At 1.6% Vs October Forecast 1.5%
By Jai Lakhani
     LONDON (MNI) - The International Monetary Fund sees economic growth in the
UK modestly higher than previously forecast for the current year, helped by
global growth, but still weighed by weaker than expected domestic demand as the
country prepares to leave the European Union, the April edition of the World
Economic Outlook shows.
     The IMF now sees UK growth in 2018 at 1.6%, 0.1 percentage point higher
than envisaged at the time of both the October WEO and the the January update.
     However, the IMF forecasts have left 2019 growth expectations unchanged at
1.5%.
     The weaker-than-expected growth is attributed to business investment
remaining subdued "in light of heightened uncertainty about post-Brexit
arrangements," the IMF WEO says. Consequently, the IMF still sees Brexit as
likely having an adverse impact on the UK economy, with the fallout starting to
impact from next year, but dependent on any trade deal.
     "The medium-term growth forecast is also broadly unchanged at 1.6%,
reflecting the anticipated higher barriers to trade and lower foreign direct
investment following Brexit," the report added. 
     The IMF see inflation at 2.7% in 2018, higher by 0.1 percentage points in
comparison to their October estimate. The IMF WEO estimate also suggests an
expected drop to 2.2% in 2019. It is worth noting is that both these estimates
sit above the Bank of England's 2% inflation target. 
--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com
--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com
[TOPICS: MABDS$,M$B$$$,M$E$$$]
MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com

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