GDP growth in the second quarter was revised up to a healthy-looking 1.2%q/q. But closer inspection reveals the recovery to be worryingly dependent on restocking. Once the process of inventory building is complete, the strong pace of growth will not be sustained. Meanwhile, despite the threat of rising crop prices, we expect inflation to drop back in 2011, meaning that interest rates will not be raised for the foreseeable future.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services