City expert says “double-dip recession cannot be ruled out”

London, 25th Jan 2010 (Travelex Global Business Payments)
Travelex Market Analysis

Mark Bolsom forecasts a “bumpy couple of years” for UK consumers and businesses

All eyes are on the UK’s GDP figures tomorrow, as the UK economy is widely expected to have exited recession in the final quarter of 2009.

Mark Bolsom, Head of the UK Trading desk at Travelex, the world’s largest non-bank FX Payments specialist said, “Sterling could be exposed to some last minute positioning today, which forces it to trade independently of euro and US dollar movements before tomorrow’s Q4 GDP data. If the data goes against the expected growth forecast, we expect that the pound will suffer significantly.

“Even if the data shows that the economy is expanding; we still expect the pound to remain weak and that, theoretically at least, UK exporters will continue to benefit.”

Bolsom expects the UK will show a growth of about 0.4 % in 2010. He says, “Some economists are very bullish in their growth forecasts. My prediction is based on the fact that businesses still seem cautious about the strength of recovery and the effectiveness of quantitative easing.

“For our business customers, credit conditions remain extremely tight and the prospect of higher taxes and public spending cuts are not reassuring.

“Although we are expected to come out of recession officially tomorrow, for many businesses economic recovery remains completely intangible. They still have to make redundancies and slash budgets as their recovery remains sluggish.

“We think that the chances of a double dip recession cannot be ruled out. Unfortunately, we forecast a bumpy couple of years for UK consumers and businesses.”

ENDS

Media enquiries
Jessica Buttress
Head of PR for Travelex Global Business Payments UK

Tel: 0208 415 4204
Mob: 077954 497129

Email: jessica.buttress@travelex.com.

Notes to editors

About Travelex

Founded in 1976, Travelex is the world’s largest non-bank foreign exchange and payments specialist; with operations across four continents and 6,000 employees worldwide.
Travelex holds key positions in its three main areas of activity: Global Business Payments (TGBP), Currency Services and Card and Mobile Payments. Every year, more than 35,000 corporate clients and 30 million customers trust Travelex to manage their foreign exchange requirements.

Recently recognised by TowerGroup research as Industry Leader for payments innovation for SMEs, Travelex currently handles international payments worth £40 billion annually for over 750 large corporate and financial institutions.

Visit www.travelexbusiness.com/uk for more information or email the press office at jessica.buttress@travelex.com