Instead of reduction, the deficit actually grew at double the expected rate for 2012.

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The second is the reduction in chatter about potential deflation and a double-dip recession.

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He said the reduction in numbers was down to a "double whammy" of its biggest operator, Air Southwest, cutting services and the effects of the economic downturn.

BBC: Newquay airport

In that case, the double dip fear could continue hanging over the market, preventing the reduction in risk premium assumed in our non-recession scenario.

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On the other hand, a drastic, immediate deficit reduction could stymie short-term economic growth and lead to a double-dip recession.

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