This reduction is due to the forecast impact of Brexit. But the average conceals a wide range underneath. At the optimistic end, growth is predicted to reach 2.7% while, at the pessimistic end, it is predicted to be just 0.6%.
Mark Twain is reputed to have said that “history doesn’t repeat itself, but it rhymes” and I agree with that. We certainly cannot lose focus on the risks that have brought down financial systems in the past: misaligned incentives and excessive credit growth, leverage, and liquidity transformation. These risks are always there.