MaxedOutMama

A preliminary estimate of Royal Bank of Scotland Group Plc's composite index fell to 51.1 from April's 51.9, NTC Economics Ltd, which carries out the survey, reported today.
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``All forward-looking indicators are very weak,'' said Sunil Kapadia, an economist at UBS Ltd. in London. ``The economy will continue to deteriorate. Banks will continue to tighten credit. We expect real disposable income to shrink in 2008.''

Gross domestic product rose 0.4 percent in the three months through March, the Office for National Statistics said in London today.
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``Firms have cut back on investment sharply, and that's only natural when you have the biggest financial shock since the Great Depression,'' said Dominic White, an economist at ABN Amro Holding NV in London and a former U.K. Treasury official. ``We're looking at a weak picture, and the odds of a negative second quarter are fairly high.''
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Investment dropped 1.6 percent in the first quarter from the previous three month after economists in a Bloomberg survey forecast a gain of 0.2 percent.

Economists from Dresdner Kleinwort were less than optimistic about the euro zone's growth outlook, saying that actual figures are likely to disappoint.

"The Eurozone is likely to see on-going growth divergence by country," they continued. "The one economy where our 2009 GDP forecast is above consensus is Germany. But, we continue to highlight the substantial imbalances that exist in other countries, especially with banks continuing to tighten lending standards. Not just Spanish GDP could disappoint, but also Italy's and that of France."

"One can't rule out the possibility...(of) Ireland posting its first negative average (GDP) growth rate for the year as a whole since 1983," said Bloxham Chief Economist Alan McQuaid.
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"With construction sector activity falling off sharply, the last thing the economy needs now is a significant retrenchment in consumer spending," McQuaid said.
"But that's how it looks at the moment, and despite a healthy performance from exports in the opening quarter of this year, the Irish economy is set for a hard landing in 2008," he said.

Speaking to multiple newswires, Bank of Japan Governor Maasaki Shirakawa said that, given uncertainties in the global financial marketplaces, it was impossible to determine the future of monetary policy and that the bank would consequently have to asses incoming upside and downside risks.
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Commenting on the recent spike in global prices, including oil, he said that conducting monetary policy to address soaring global prices was not a good idea and that central banks should instead focus on how asset prices affected the economy.

"Our objective is to achieve sustainable economic growth under price stability and we also pay attention to how strongly asset price moves affect the economy," he said.

...Andrew Sentance, Bank of England monetary policy committee member, said that while the BOE was not forecasting a recession in the UK, one could not be ruled out. He went on to say that a significant slowdown was to be expected.
He said that, as consumer spending slowed, the economy would probably become more dependent on the export sector.

"In the opinion of the majority of the Council...the risk of a fall in economic growth in Poland and of an excessive appreciation of the zloty exchange rate, both of which would be reducing inflation in the medium term, justified no interest rate change at the current (April) meeting," the minutes said.
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"They assessed that the deceleration of economic growth in Western European countries, in combination with the zloty appreciation observed over the past months, may be lowering the growth rate of Polish exports and, consequently, have a negative impact on GDP growth in Poland," the minutes said.
The zloty has been flirting with an all-time high and is some 30 percent up since Poland joined the European Union in 2004.