We would draw readers' attention to two particular aspects of this forecast. First, we have not made any adjustment for the effects of the current industrial disturbances. Past experience suggests that, provided the disruption is not protracted, losses ofproduction and exports tend to be made up rapidly when normality returns. Since our main purpose is to forecast the underlying trends in the economy, we therefore decided that at this stage we would make no special allowance for the events of January and early February.

Secondly, we have not attempted to allow for the possible but as yet unquantifiable effects of the upheaval in Iran. This may seriously affect both energy supplies, with implications for both the world and the British economies, and UK exports to Iran. But again there is at this point no way of making specific numerical adjustments.

In both cases, any lasting effects that there may be can only worsen the economic outlook presented here. We can do no more than urge readers to bear that in mind in interpreting the forecasts set out below.