Annualised GDP growth is on course to accelerate to around 4% in the fourth quarter, from 2.5% in the third. Moreover, the new fiscal stimulus means that we now expect growth to average 3% in 2011. Nevertheless, while the stimulus will provide a temporary boost, we don't believe that it will prompt a sustained pick-up in the growth of private sector demand. The structural problems around household and financial sector balance sheets are simply too great. As a result, we still expect GDP growth to drop back to around 2% in 2012.
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