Published On: Tue, Apr 28th, 2015

Weak Economy Might Cost Cameron The Elections

David Cameron

New data released has come at the worst time possible for David Cameron.

The Conservative party led by Prime Minister David Cameron is in an awkward situation right now since recent data shows the economy in the UK isn’t doing as well as it was previously thought. The market is at its weakest since 2012 which instantly triggered politicians to prove their economic credentials and sway voters to their side.

The elections are just over one week away and recent polls show that main opponents are neck-and-neck with each other. Neither the Conservatives in coalition with the Liberal Democrats nor the Labour Party are close to winning the majority in Parliament.

George Osborn, Chancellor of the Exchequer tried to turn the situation to its advantage saying how this is normal after continuous growth. No matter what, the facts show that the economy has weakened, with the pound dropping by 5 percent against the Dollar in the last six months.

Even with an economy growth of over 8.4 percent since the last elections Cameron is endangered in the present situation. While he is boasting an unemployment rate drop and steady job positions his competition is pointing out in fact that even with this growth the standard of living for regular everyday people is the same and there is also no improvement for middle class working men and women.

Some found the criticism a bit too harsh and said that it’s impossible to confirm a slowdown just by the first quarter’s numbers which are always weaker than its successor’s. Morgan Stanley said it’s “reluctant” to see first quarter numbers as the basis of a slowdown.

“…inflation perceptions, outlook for personal finances – they matter more than ‘hard data’ in influencing party preferences,” said Melanie Baker, economist at Morgan Stanley.

The “slowdowns” impact was so strong because the biggest loss was documented in services which are the largest part of Britain’s economy. In the first quarter services gained slight growth of 0.5 percent which is the lowest since 2013. Services related to business and finance rose by only 0.1 percent hitting the lowest point since 2010.

The biggest losers with a drop of 0.1 and 1.6 percent in the first quarter are production and construction. Compared to last year 2015 began on the wrong foot, being considered the worst in years.

Stories about inflation and a market drop may harm the Conservatives elections hopes which are scheduled for May 7th. A storm of hard evidence and record data came in the worst possible time for the current Prime Minister David Cameron. How the change will affect the vote of people in Britain will be clear 10 days.

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