Oxford Economic Country Briefings, December 20th, 2006
Highlights and Key Issues
* With less pressure for monetary restraint after euro adoption delay, the government plans further fiscal tightening to curb inflation, so is projecting a sharp growth slowdown from about 8% this year. However, deep spending cuts are ruled out by its parliamentary position and growth is set to stay close to 6% in 2007-12.
* But inflation should be below official forecasts in 2007-10, with excess demand mainly feeding into the current account deficit, which on present trends will not fall below 8% of GDP before 2011 even without any further jumps in fuel import cost...
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