Uk Recession

UK ECONOMY GROWTH FROM DEEP RECESSION:

In UK, while considering the level of the decline is found by 2 factors,

* After the big fall of international banking system there is more weakness in credit zone.

* Failure in spending and producing the products by lack of confidence

Recuperating the Economic level is not possible in short period. In 2009, UK GDP falls to 6%. It initially shows the negative GDP in 3rd and 4th quarters in 2008 and the government project there is no growth in country’s GDP till 2010. The analysis reported that the decline will be smaller in continental Europe. The organization for Economic Co-operation and Development (OECD) analysed and reported that retardation has been more “distinct than projected”. As a result, in 2010 the growth forecast for the leading economies reduces to 1.5% from 1.75%.

Due to recession the consumer is less in purchasing of apparels. The retailer already imported huge amount of apparel goods. The inventory level is increased with most of the retailers in UK. As the supplies of apparel is more and demand in the market is less because of recession. The price of apparel is reduced. The less demand in market made the retailers to reduce the garment sales price by giving more discounts is directly reducing their profit margins.

IMPACT OF CRUDE OIL PRICE INCREASE:

considering the crude oil production down in 2008 which increases the price of the crude oil from $40 barrel to $92 per barrel. The increase in crude oil price obviously leads to higher transportation cost of goods. Also the purchasing of crude oil is made with other currencies. Because of recession the pound value is also decreased in the recent months. So the conversion rate is higher while purchasing importing the crude oil from other countries. So the purchasing value of crude oil from the market is indirectly increased. Increase in crude oil price leads to more inflation in the country. The essential commodity product prices will...