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

No Talks Till Terror Ends: India to Pakistan

The MEA’s strong response came at a time when Pakistan, pushed on the backfoot by India’s decisive Operation Sindoor, has suddenly started talking about its intent on having peace talks with India….reports

BNP ramps up poll demand

Chief Adviser Yunus had earlier promised elections in December 2025, but the timeline has since been pushed back first to February 2026 and then to June 2026, fuelling suspicion and dissatisfaction among

Saudi backs India’s strategic outreach

In a series of engagements, the Indian delegation met Saudi Arabia’s Minister of State Adel Al-Jubeir and other senior officials. A high-profile Indian all-party parliamentary delegation, led by BJP MP Baijayant Jay

India clears stealth fighter project

New execution model paves way for private sector involvement in India’s ambitious stealth aircraft programme; Army showcases next-gen drone warfare systems. In a landmark decision bolstering India’s defence self-reliance, Defence Minister Rajnath

ASEAN lauds India’s firm stance on terrorism

The ASEAN Secretary-General reaffirmed the bloc’s resolve to deepen collaboration with India—a comprehensive strategic partner—in security and counter-terrorism efforts. The Indian all-party Parliamentary delegation, led by Janata Dal (United) MP Sanjay Jha,
Go toTop

Don't Miss

UCB inks pact with Indian Unis to boost skills development

Staff from the University travelled recently to India to visit

Vaughan Gething to stand down at next election

Morgan was the health secretary from 2021 until she succeeded