May 24, 2023
1 min read

IMF says UK economy to avoid recession in 2023

Inflation in the UK was 10.1 per cent in March…reports Asian Lite News

The UK economy is expected to avoid a recession and maintain positive growth in 2023, said International Monetary Fund (IMF), attributing it to demand recovery due to declining energy prices.

A recession is often defined as two consecutive quarters of negative growth in the real GDP. IMF now forecasts the UK’s growth to slow to 0.4 per cent in 2023, as against its earlier estimate of (-) 0.3 degrowth. It attributed the low growth to tighter monetary and fiscal policies needed to curb inflation.

Bank of England’s monetary policy committee recently hiked key interest rates by 25 basis points (100 basis points is equal to one percentage point) to 4.5 per cent, the highest in over a decade or so. The Bank of England (BoE) was the first major central bank to lift its policy rate (in December 2021) and had since hiked Bank Rate by 440 basis points.

IMF forecasts UK to grow gradually to 1 per cent in 2024, expecting that the disinflation will improve incomes. For 2025 and 2026, the UK economy is expected to average 2 per cent mainly on the back of a projected easing in monetary and financial conditions.

“Declining energy prices and widening economic slack are expected to substantially reduce inflation to around 5 percent y/y by end-2023; and below the 2 per cent target by mid-2025,” IMF said in a statement on Tuesday. Inflation in the UK was 10.1 per cent in March.

The Bank of England typically sets monetary policy to meet the 2 per cent inflation target, and in a way that helps to sustain growth and employment.

“Monetary policy will need to remain tight to keep inflation expectations well-anchored and bring inflation back to target,” IMF said in the statement. (ANI)

ALSO READ-Royal Family reject calls to return Ethiopian Prince’s remains

Previous Story

Royal Family reject calls to return Ethiopian Prince’s remains

Next Story

SPECIAL: Battling backlash in polio vaccination campaign in Pakistan

Latest from -Top News

Palestine Seeks Record UK Compensation

Palestinian Authority President Mahmoud Abbas cites international law, seeking compensation for land and perceived injustices during British rule….reports Asian Lite News Britain faces a £2 trillion reparations claim from the Palestinian Authority

Khalistan Network Under Fire in Canada

Indian agencies regularly share intelligence with their Canadian counterparts, including on groups like Babbar Khalsa International, but the current focus is firmly on SFJ….reports Asian Lite News The arrest of Inderjeet Singh

India, France Hold Nuclear Talks

The meeting, held on Monday, reviewed progress in bilateral civil nuclear cooperation and explored avenues to deepen the strategic partnership…reports Asian Lite News India and France convened the second meeting of their

Trump to Meet Pak PM at UNGA

The US President has already engaged with Pakistan’s military leadership, having hosted Army Chief Asim Munir for a lunch meeting in June….reports Asian Lite News The White House announced on Monday that

EU’s Kallas Calls India ‘Reliable’ Partner

The EU said its closer partnership with India is increasingly becoming vital in the wake of the shifting geopolitical realities…reports Asian Lite News European Union’s top diplomat Kaja Kallas has reaffirmed that
Go toTop

Don't Miss

Sunak announces bank holiday for coronation of King

Prince Charles,73, automatically became the King of the UK after

UK govt will give India Rolls-Royce jet tech

Chalk said, it means ensuring that the engine which is