The UK is already in the midst of a recession, and inflation is on course to hit 14% later this year, according British Chambers of Commerce forecasts that heap more pressure on the nation’s new prime minister to act fast to avoid an economic calamity.
(Bloomberg) — The UK is already in the midst of a recession, and inflation is on course to hit 14% later this year, according British Chambers of Commerce forecasts that heap more pressure on the nation’s new prime minister to act fast to avoid an economic calamity.
The business lobby group says it expects the economy to follow its second quarter contraction with two more periods of decline to round off the year before a meager bounceback of just 0.2% in 2023.
It blames the crumbling outlook on rising energy costs and a decline in household spending and real wages, as well as weaker export prospects, poor investment conditions and weakening business confidence.
Inflation meanwhile will hit 14% this winter, according to the BCC, and be 5% by the end of 2023. While the forecasts are less dramatic than others released in recent days, the warning from the lobby contains a powerful plea on behalf on British business for immediate action.
“Time is fast running out,” said Alex Veitch, Director of Policy at the BCC. “The government must step up to the plate and do what is needed to protect businesses, livelihoods and jobs. The extreme inflationary pressures already present are only likely to increase as we head towards Christmas.”
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