THE Treasury is relying on a bounce in the economy at the end of the year to boost growth and set the tone for recovery during 2010. Despite gloomier-than-expected figures last week, officials said the economy remained on the trajectory expected in the April budget.

Unfortunately the goverment is using the treasury to cover up the real extend of the downturn, I anticipate that the out-turn for 2009 well below Darling’s budget forecast, with a drop of nearly 4.5% for the year, against the 3.25%-3.75% range he set out.

What is worrying particularly is the nervous nature of the bond market, whislt sterling has recovered significantly since the new year, I can see real  interest rates being pushed up and sterling weakening again.