Better GDP figures and an emergency UK budget following an election lead are among centre for economics and business research (CEBR)’s economic predictions for 2010.

The CEBR predicts:

1) An election and a new government.

2) An emergency UK Budget following  the election where fiscal retrenchment measures are announced with £100bn of fiscal action resulting in higher taxes  and real cuts in the cost of providing public services.

3) Improved GDP growth numbers on 2009 (world GDP probably declined in the year by about 0.5%, UK GDP by 4.7% in 2009  but the CEBR predicts GDP growth of about 2% and UK growth of around 1% in 2010).

4) Low inflation worldwide.

5) Rising interest rates

6) A predicted crisis for the pound.

7) A small recovery in UK housing transactions and rising house prices.

8) A tough year for the UK consumer as real incomes are squeezed and those who rely on the public sector for their incomes becoming nervous about what happens next.

9) A slight increase in business failures in the UK in 2010 on 2009.