Easing inflation

The UK economy stands on the precipice of contraction, with businesses’ turnover expectations falling further in December. However, easing inflationary pressures may help prevent the UK from falling back into recession, despite lowered revenue expectations, research finds. According to Audit, accounting and business services firm, BDO.

BDO’s Output Index, which measures turnover expectations three months ahead, has now remained below the crucial 95.0 mark that indicates growth since July 2011. However, while the outlook is gloomy, the accountancy firm's Inflation Index came down for the fifth consecutive month. The decrease in the Inflation Index is welcome news for consumers, who are expected to feel less of a squeeze in 2012.

APA joins others and urges the Bank of England to consider a further round of quantitative easing, and also wants to see the banks continue to step up their lending to UK businesses; especially those that employ more people. APA also wants to see the government introducing measures in 2012 that encourage private sector investment in long-term infrastructure developments like HS2.

APA