The UK economy is now expected to grow by 1.3% in 2026, an upward revision from the 1% predicted in July, according to the International Monetary Fund (IMF). However, the organisation cautioned that higher energy prices and interest rates are anticipated to impact the economy in 2027.
Globally, economies have shown resilience to energy price shocks stemming from the US-Iran war, the IMF noted. Despite this, the economic consequences of the conflict remain highly uncertain. The IMF also highlighted that the UK is on track to stabilize its national debt, a position shared by few other major economies.
The UK is projected to have the lowest annual borrowing among G7 nations in 2031. The IMF’s chief economist suggested that the UK has already begun a debt consolidation process and should continue on this path. These forecasts are predictions and may be subject to change due to global events.
Chancellor John Healey stated that the government intends to offer financial relief to households in the upcoming Budget. His plans, to be announced on October 28, are being finalized and must be credible to financial markets, on which the UK depends for borrowing.
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Source: bbc.co.uk
