In a fresh humiliation for Rachel Reeves, the International Monetary Fund has slashed growth forecasts for the UK, leaving Britain facing the biggest hit from the Iran war of the major developed G7 nations. The Mail‘s This is Money has more.
Britain faces the biggest hit from the Iran war of the major developed nations, according to doom laden new projections from the International Monetary Fund.
In a damning report, the global watchdog said it now expects the UK economy to grow by just 0.8% this year as soaring energy prices batter households and businesses already straining under Labour’s tax hikes.
The growth forecast is 0.5 percentage points lower than it anticipated in January – marking the biggest downgrade of any nation in the G7.
The IMF also cut the outlook for next year by 0.2 percentage points to a feeble 1.3%.
And it warned that UK inflation will head towards 4% while unemployment is set to reach 5.6%.
That would be the highest rate since early 2015 – outstripping the peak of 5.3% seen during the COVID-19 pandemic.
The IMF added that things could be even worse with a global recession “a close call” if the war intensifies.
The projections leave Labour’s vow to turn Britain into the fastest growing nation in the G7 in tatters and make a mockery of the Chancellor’s claims to have put the UK “in a stronger position because of the choices this Government took to build economic stability”.
Rachel Reeves, who is at the IMF’s spring meetings in Washington DC this week, insisted she has “the right plan for a more volatile world” and called on others to follow her lead.
But in a further setback, the IMF said it now expects living standards in the UK to barely grow this year, with output per person set to rise by just 0.3%, the weakest in the G7.
Among all the major economies mentioned in the report, only South Africa is expected to fare worse.
Shadow Chancellor Sir Mel Stride said: “Being handed the biggest downgrade in the G7 is a clear verdict on Rachel Reeves’ choices – and she’s got no one to blame but herself.
“The Chancellor hiked national insurance in her first Budget, doubling inflation and sending unemployment soaring. She is driving the hospitality industry out of business with business rates increases and planning the first hike in fuel duty in 15 years. Her plan to keep costs down has left us with the highest inflation in the G7, with businesses closing and the cost of living skyrocketing.”
Worth reading in full.
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I think you’re crediting her with a self-awareness she does not possess. She won’t give a flying fig.
I think she is too stupid to have self-awareness.
“And it warned that UK inflation will head towards 4% while unemployment is set to reach 5.6%.”
That’s official “inflation” towards 4%. Not real inflation – the price-gouging you see when you try to do insane things like buy food or pay your bills.
What is this bizarre “inflation” rate – which, natch, is used as the basis for pay-rises, if you even get one – based on? Some “basket” of items commonly bought in the 1940s?
Even 0.8% growth seems optimistic. Isnt it time Britain was demoted from the G7?
Exactly what I was thinking. By GDP per capita we have been in a recession for months.
Smarmer and Reeves tell us that Brexit has seriously damaged our economy and we must kiss and make up with the EU, yet France and Germany have fared no better than us despite being in the Shangri La of the EU
Another illustration of this government’s tenuous grip on reality.
I doubt very much if she feels the sting of humiliation.
Socialists don’t understand economics.
If they understood economics they wouldn’t be socialists.
How can Rachel strut her stuff in the USA when it’s so obvious that whoever pulls her strings are insane, poor woman must have a tremendously thick skin.
The destruction of Great Britain is coming along splendidly Rachel, your bosses must be delighted. The cheque is in the post. Keep up the good work.
This exactly this!
I wonder where she’ll pop up when Labour is kicked out of Office? I’m sure there’s a nice little (taxpayer-funded) democratically-unaccountable sinecure lined up for her ….. and Two-Tier.
I could see her working for the IMF when we have to go cap-in-hand to it for a bailout. Imagine the fun she’ll have tying us up in all sorts of regulatory knots before we can access the funds.