With factory prices showing a slump, many economists are predicting that the base rates in UK will remain the same until 2012. This assumption is based on continuing economic problems – triggered by the recession – that UK and many other countries are facing today.
This situation was, however, foreseen by many economists who predicted that this recession would not be the regular boom and bust scenario. Many countries are finding it difficult to recover from the problems that cropped up during this recession – many financial institutions have gone bust and banks are finding it difficult to operate on a tottering economy. To save the situation, the government is pouring large amounts of tax payers’ money into the local economy.
But this scenario is not likely to change overnight. Many governments are facing a severe credit crunch and resolving these issues would take more time than expected.
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