According to a paper released yesterday by the National Institute of Economic and Social Research (NIESR), the UK's gross domestic product (GDP) will expand at a rate of 1.4 per cent throughout 2011 before reaching growth levels of two per cent on year later.
This represents a lower figure than that predicted by the Conservative-Liberal Democrat alliance and, the body added, is primarily down to the effects of the government's austerity measures and rising inflation.
The British administration has sought to cut more than Â£6 billion from the public spending bill since coming to power in May last year, which has contributed to the NIESR's estimation that the nation's consumer prices index marker of inflation will hit 4.5 per cent this year.
Meanwhile, the Bank of England yesterday decided to maintain the UK's base rate of interest at 0.5 per cent for the 26th month in succession.
By Asim Shah