GUEST BLOG: Business analyst Stephen Archer's economic predictions for 2012

Every pundit and futurologist I have met or heard has said that 2012 is the hardest year to call. I agree and that's my let out when this is reviewed in 12 months' time. So here goes:

UK: growth will return after a technical recession in the first half of the year.

The UK economy will increasingly look like the more attractive side of Europe, aside from Germany and Scandinavia. Inflation will fall to 3%; the Pound will gain strength against the Dollar and Euro by about 5%.

Unemployment will peak at 2.9million. We will have a ball with the Queen's Golden Jubilee and the Olympics where the UK will win 26 gold medals.

Europe: The Eurozone will go into a minor recession but will emerge again by the year end. The debt crisis will only just have a clear resolution by Easter, by which time the mechanism for expelling Greece (they will not volunteer to leave) will be in place.

The ECB will buy sovereign bonds having bought private bank bonds in 2011 to the tune of half a trillion Euros. Italy will have a torrid year and suffer the effects of austerity measures - large scale public disorder. And maybe a new opera and Ferrari.

The Eurozone will then achieve some stability and the crisis will have passed.

USA: The economy will continue to recover, though the electorate will continue to feel less well off. Depending on the Republican nomination, Obama will just be re-elected in November - even if he is pitted against Romney.

The US debt will reach $16 trillion but few will care - much. The US recovery will help Obama be re-elected and the global economic confidence to lift.

World: Assad of Syria will be gone by June and there will be a quiet revolution in Iran that will depose Ahmadinejad. Pakistan will continue its bad relations with the US and be more isolated in the region. The new Chinese Premier will preside over growth but not double digit in 2012.

Other: There will be a flood/earthquake/tsunami/volcanic eruption. Perhaps, just perhaps, an improvement in national matters will give us back the capacity to be shocked by these events.

Cyber attacks, commercial and geopolitical will increase and be a cause of rising international tensions. 'The Artist' will win best picture at the Oscars. That dog deserves its own Oscar!

So there are some predictions, but no-one will be less surprised than me if they are all wrong!

Read other guest blog posts by Stephen:

Stephen Archer: "The Eurozone demise is a new age Greek tragedy"

Stephen Archer: "Business leaders are losing their nerve!"

Stephen Archer: "What has the Coalition government really done for small business?"

In association with


If you're interested in a start-up business bank account, contact NatWest to realise your ambitions.

We use cookies to create the most secure and effective website possible for our customers. Full details can be found here