Brokers see the Eurozone recession as the biggest threat to UK’s economic recovery, a United Trust Bank (UTB) survey has found.
According to the brokers, the second most significant threat would be a new UK government with a different economic agenda.
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The rest of the remaining threats identified, in order of importance, were: World recession, a rise in UK interest rate, the national debt, and a decline in UK property prices.
UTB surveyed 111 brokers in November, asking them to rate in order of importance the factors they believed posed the biggest threat to continued economic recovery in the UK. The bank then organized the results to create a final league table.
Brokers were also asked for their view on the outlook for the UK economy over the next three years. 59% of them said they were expecting to see a steady improvement, 33% of the respondents described the outlook as ‘unsettled’, while only 7% answered ‘bright’.
Harley Kagan, managing director of United Trust Bank, said: "Brokers believe something which may be out of our hands as the biggest threat to the UK’s continued economic recovery. And they could be right. The Eurozone has very low levels of inflation with some countries such as Italy, Spain and Greece already in deflation. Deflation can be disastrous for economies trying to service debts and can dissuade individuals and businesses from spending and investing, hitting corporate profits, costing jobs and cutting tax revenues.
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By GlobalData"The Eurozone is also struggling to increase its economic output and reduce unemployment. Currently running at 11.5%, it’s nearly twice the UK’s unemployment rate. The International Monetary Fund (IMF) recently estimated that there was a 40% chance of the Eurozone having another recession.
"The outcome of the May general election will also play a major factor in how the UK economy will fare over the next few years. Whilst the coalition government’s austerity measures have been unpopular with many, the UK’s finances appear to be in better shape than most of its European neighbours. The voting public will decide on the tradeoff between cuts to public services and the debt burden. A government with a different approach may well have more crowd pleasing policies."
