British Chamber of Commerce cuts growth forecast

The British Chambers of Commerce (BCC) has cut its forecast for growth this year and next, forecasting gross domestic product (GDP) to edge up by 0.6% in 2013 and 1.7% in 2014.

It believes the UK will avoid a triple dip recession, with the economy recovering from its 0.3% contraction in the fourth quarter to grow in the first quarter - albeit by a paltry 0.1%.

David Kern, BCC chief economist, said:

We expect quarterly growth to increase very gradually over the next two years, but it will remain modest and below-trend for some time.

In addition, we now expect GDP to return to its pre-recession levels early in 2015 and the squeeze on living standards will continue for a while longer.

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QE and interest rates unchanged

The Bank of England voted to keep quantitative easing unchanged and held interest rates at 0.5%.