While there is a possibility Britain could witness a double-dip recession, this is unlikely because output is already quite low, Investment and Business News has claimed.
This observation follows research published by BDO LLP which revealed that business confidence has dropped to 93.1 in August from 95.5 in July.
It is the first time the index has fallen below the crucial 95 mark since July 2009, suggesting that the economy may contract in the fourth quarter, if existing trends persist.
According to Michael Baxter, editor of Investment and Business News, the economic prospects in the short-term are not particularly good.
"When you haven't even recovered to the previous peak," he explained, "it is quite unusual to then have another recession."
Mr Baxter added: "It is difficult to have a recession when your output is already at a low level."
Last week, the Bank of England opted to keep the base rate at the historically low level of 0.5 per cent.
Investors told double-dip recession is unlikely
Investors told double-dip recession is unlikely
Tue, 14 Sep 2010
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