CBI predicts 3.0pc GDP increase
Previously it was expected to rise by 2.6% in 2014 and 2.5% in 2015.
The economy flourished by 0.8% in Q1 2014.
With its optimistic GDP growth forecasts the CBI is expecting a 0.25 percentage point increase in Bank of England interest rates by Q1 2015.
John Cridland, CBI director-general, said: “The recovery is advancing after a strong performance in the first quarter of 2014. Prospects are bright and we expect the recovery to broaden out this year, with greater support from business investment in particular.”
Unemployment is expected to reach 6.8% this year before tumbling to 6.2% by the end of 2015.
The CBI is worried that the impending 2015 general election will lead to short-term market intervention policies, undermining the long-term economic recovery.
Cridland added: “While economic signs are encouraging, the CBI said political uncertainty remains a major risk to the recovery. Setting out its headline priorities one year out from the general election, the CBI urged politicians to stick with what’s working and tackle the UK’s long-term economic challenges.
“Businesses recognise the realities of election time but want all parties to ensure their policies make a positive difference. Politicians must be wary of the risk of headline-grabbing policies that weaken investment, opportunity and jobs.”