In this review our forecast is extended by a further complete year to the end of 1981. Our forecast for 1980 is in several respects rather more pessimistic than we suggested in August, but the addition of the forecast for 1981 shows that some improvement in real GDP and real disposable income is then expected. Unemployment on the other hand continues to increase but is now likely to be rather lower during 1980 than had previously been thought. As a contrast, inflation in consumer prices is forecast at a rather higher level for 1980, falling only by 1981 to the level previously anticipated for 1980. The current account balance is considerably worsened, not just for 1980 and 1981 but also for the current year, largely as a result of the higher level of imports following their rapid increase in the first two quarters of the year. The borrowing requirement remains very close to our previous calculation and is expected to fall slightly in 1981-2.