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Schroders says Brown is overly confident on growth

Schroders says Chancellor Gordon Brown&#39s seventh Budget contained few surprises for the wider economy other than false optimism for growth in 2004 and 2005.

UK economist Stuart Block says the revised growth forecast for this year down from 2.5-3 per cent to 2-2.5 per cent is generally good for the investment sector.

But he fears the Chancellor is being overly confident by refusing to change his prediction for growth in 2004 and 2005 of 3-3.5 per cent.

Block has welcomed the Chancellor&#39s announcement of a review into the use of long-term fixed-rate loans in the UK housing market, claiming they make the economy less sensitive to short-term rate movements.

He says: “As expected, there are no big surprises in this year&#39s Budget, with borrowing taking the strain as growth disappoints.

“Forecast net borrowing has been revised up less than expected – only £3bn extra this fiscal year and £5bn next year – but this is due to the Chancellor retaining his over-optimistic growth outlook from 2003 onwards.

“Perhaps more interesting are his plans to develop the market for fixed-rate mortgages in the UK. While this is not a 2003 story, this would make the UK less sensitive to movements in short-term interest rates and hence make entry into European Monetary Union a less unappealing mediumterm story.”


UCB sets out steps to buy-to-let success

Nationwide&#39s specialist lender UCB Home Loans is publishing a free guide for budding landlords who want to take their first steps into the buy-to-let market. UCB says buy to let is a rapidly increasing market and spring has become a traditional time to seek out new properties. The guide, Buying to Let – Know The […]

DWP and MPs say pension system is basically sound

The Department for Work and Pensions and MPs believe the pension system is sound despite widespread claims of a pension crisis. Tory MPs were defeated on a pension crisis vote by the select committee which scrutinises the DWP. The committee&#39s report, published this week, backs the DWP view that while the UK has problems with […]

Ban for agent who &#39preyed on clients&#39

The FSA has obtained a permanent injunction against unqualified accountant and bookkeeper Alan Evitts, preventing him illegally taking deposits from investors. The High Court heard that Evitts, from Glossop, Derbyshire, had illegally taken nearly £150,000 in deposits from potential investors and made a number of false and misleading statements. The court order also prevents him […]

Ingledew to be chief exec in BBB shake-up

Chief executive Cliff Lockyer is to become chairman of national IFA group Berkeley Berry Birch in a board shake-up, with his deputy Stephen Ingledew becoming chief executive. The group has tried unsuccessfully since the start of the year to attract a non-executive chairman to replace Sir Jeremy Black, who retired at the end of 2002. […]

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Investment ideas to power returns

We believe the most exciting stockmarket opportunities today are in those places where a new generation of leaders are successfully transforming economies and companies in favour of investors. In a new investment guide and website, which is suitable for use with your clients, we set out our views on these reformers. Click here to find […]


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