Downing Avenue Defends UK Financial system After Bleak IMF Forecast

Downing Street Defends UK Economy After Bleak IMF Forecast

UK PM Sunak’s workplace mentioned the nation is predicted to develop sooner than Germany. (Representational)

London, United Kingdom:

British Prime Minister Rishi Sunak’s workplace was pressured to defend the nation’s financial efficiency on Tuesday after a dire IMF forecast that the UK is ready to fare worse than every other nation within the developed world.

Within the newest replace of its financial forecasts, the Worldwide Financial Fund (IMF) mentioned that it anticipated the UK’s gross home product (GDP) to contract by 0.6 per cent in 2023, a downgrade from its earlier evaluation.

Downing Avenue insisted that the UK’s financial system is powerful regardless of the IMF warning that Britain’s financial system will backtrack this yr.

“The IMF itself mentioned that UK financial coverage is now heading in the right direction,” Sunak’s official spokesperson informed reporters.

The spokesperson added that the UK outperformed many forecasts final yr and was “predicted to develop sooner than Germany and Japan over the approaching years”.

The Opposition Labour Celebration raised an pressing query within the Home of Commons on the IMF forecast and blamed it on 13 years of a Conservative Celebration led authorities’s “failure”.

“Immediately’s IMF evaluation holds a mirror as much as the wasted alternatives and it’s not a fairly sight,” mentioned Rachel Reeves, the shadow chancellor.

“The UK is the one main financial system forecast to shrink this yr. Weaker development in comparison with our rivals for each of the following two years. The world upgraded, Britain downgraded. Progress even worse than sanctions-hit Russia,” mentioned Reeves.

IMF mentioned in its newest evaluation that whereas the broader international financial system was doing higher than anticipated, with inflation having peaked and funding starting to show round, the UK financial system would face a downgrade “reflecting tighter fiscal and financial insurance policies and monetary circumstances and still-high vitality retail costs weighing on family budgets”.

UK Chancellor Jeremy Hunt mentioned of the forecast: “The governor of the Financial institution of England not too long ago mentioned that any UK recession this yr is more likely to be shallower than beforehand predicted, nevertheless these figures affirm we aren’t resistant to the pressures hitting practically all superior economies.

“Quick-term challenges mustn’t obscure our long-term prospects – the UK outperformed many forecasts final yr, and if we follow our plan to halve inflation, the UK remains to be predicted to develop sooner than Germany and Japan over the approaching years.”

(Apart from the headline, this story has not been edited by NDTV workers and is printed from a syndicated feed.)

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