Forecast Summary

Little has happened in the three months since our post-election forecast to undermine the view that the economy has entered a period of sustainable recovery. We expect output to grow by 21/4 per cent (at 1975 prices - faster on a 1980 price basis) this year and in the 2–21/2 per cent range in both 1984 and 1985. We expect inflation to rise from its recent low point as special factors unwind, but to settle at around 6 per cent in 1984 and 1985.