London Olympics set to give much needed boost to UK economy
The investment bank says spending on goods and services, particularly in shops, restaurants and hotels, will have a significant short-term impact on GDP.
But it also said the benefit would be stunted somewhat by the decisions of some tourists to stay away from the country during the Olympic Games.
Additionally, Kevin Daly, Goldman’s chief UK economist, said the benefit would be “largely reversed” in Q4.
“It is difficult to estimate what the net effect of the indirect and other off-setting effects will be [on GDP],” he said.
“As a central estimate, we have assumed that these effects will net out and that the overall short-term effect of staging the London Olympics will be to boost UK economic output in 2012 Q3 by around 0.3-0.4ppt quarter-on-quarter.”
Meanwhile, the bank, using what it said was an economic model, has predicted Great Britain will finish in third place in the London 2012 medals table, with a total haul of 30 gold medals.
It said Team GB will finish with 65 medals in total, putting it in third place in the medals table and well ahead of the 47 it achieved at the Beijing Olympics four years ago.