AN ECONOMICS expert had an upbeat message on the global and UK economy to give to Basingstoke business leaders.
Trevor Williams, head of group economic research for Lloyds TSB, spoke to an audience of about 100 people at a breakfast seminar at The ARK Conference Centre.
He opened his hour-long presentation with the words: "The world economy is in its best shape for about 30 years and we look forward to future growth in 2005."
Despite the slowdown in retail sales, Mr Williams said consumer confidence was still strong, although people were being more cautious and tightening up on their spending.
And on the worries of where the property market is heading, he said: "The housing market may be slowing but it is still growing."
Cost pressures for firms have been rising and company profit margins remain tight but Mr Williams did not include any thought of recession in his reading of the economy.
He predicted that, although the economy was in good shape, growth will slow from last year's pace of three-and-a-quarter per cent to two-and-three-quarters per cent this year. And corporate sector expansion will replace some of the growth lost from a slowdown in consumer spending.
His summary of the economy was: "There are risks, as ever, and growth will slow in 2005, partly due to higher oil prices and higher interest rates.
"Wage inflation is likely to see some modest acceleration - the labour market is tight and public sector pressures on employment remain strong."
He added: "Consumer price inflation is now likely to exceed the two per cent target at some stage in the next two years.
"This implies that interest rates may rise modestly from current levels."
Stuart Shepherd, senior relationship manager for Lloyd TSB Commercial in Basingstoke, said: "Basingstoke is a microcosm of the global economy because of our wide spread of businesses.
"This year has seen us get off to a reasonable start in quarter one."
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