Ekonomické zprávy

IMF has improved its forecast for the UK economy

The International Monetary Fund has said that the UK economy is likely to avoid a recession this year, given the resilience of demand, faster-than-usual wage growth, lower energy prices and the normalization of global supply chains.

According to the new IMF forecast, the UK economy will expand by 0.4% this year. The previous forecast, presented in April, assumed that GDP shrank by 0.3% in 2023. The IMF also expects economic growth to accelerate to 1% next year and average about 2% in 2025-2026.

As for the inflation outlook, the IMF predicts that consumer inflation will slow to about 5% by the end of this year amid falling energy prices and the strengthening of the economic downturn. The IMF estimates that consumer inflation will fall below the Central Bank's 2% target by mid-2025.

Meanwhile, the Bank of England said following the May meeting that it was expecting a soft landing from the bout of high inflation and a year of interest rate hikes. One reason is that global demand for goods and services is expected to be higher. The central bank now expects weak GDP growth of 0.25% in 2023 compared to a predicted 0.5% contraction in the previous report, and thinks growth will be 0.75% in both 2024 and 2025.

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