Will it pour in rainy Britain?

| 17-07-2009| Business & Investing

In a country where it rains so much, will there now be a downpour on the British economy as swine flu mixes with the recession?

Swine flu

Possibly, according to a new report from Oxford Economics which tells us that a swine flu pandemic lasting just six months – this autumn or winter for example – could cost the British economy no less than £60 billion, as well as lengthening the recession another two years.

It would be an especially wet storm if we were to pay attention to the forecast which has the black cloud of deflation appearing in the skies over the British economy for the next two years – from 2010 until 2012 – at a constant rate of -1%.

“There is a significant risk that the pandemic triggers a set of unfavourable behavioural changes that tip it into deflation. A flu outbreak in the autumn would hit just as the economy starts to recover from the credit crunch. It would threaten already fragile businesses and put further strains on financial markets and fiscal balances.

The rains will leave important damage behind after passing over the Isles – they have somehow based their study on 30% of the British population falling ill with swine flu, and a mortality rate of 0.4%.

This forecast is even worse than the British government’s own version, which has 65,000 people dying from swine flu.