Although the economy grew strongly over the first half of this year, that growth was still overly dependent on the heavily indebted household sector. That arrangement was possible when interest rates were near record lows and house prices were rising rapidly. But with interest rates now rising and the housing boom at an end, we fear that economic growth will fade. Even after allowing for stronger export growth, we expect real GDP growth to slow from 3.0% in 2017 to 1.5% in 2018.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services