The UK’s economic growth is slowing further due to rampant inflation and it is set to be the weakest economy among the G7 nations next year, the International Monetary Fund (IMF) has warned.
It came as the IMF warned that stalling growth across the world means we could be “teetering on the edge of a global recession”.
In its latest World Economic Outlook update, the body downgraded its UK growth forecast for 2022 to 3.2%, from 3.7% in April.
This had already been a downgrade from 4.7% at the start of the year.
The outlook for the UK is expected to become even more gloomy in 2023, with the IMF cutting its forecast for next year to 0.5% growth from a previous 1.2% estimate.
IMF Growth Projections: 2022
USA🇺🇸: 2.3%Germany🇩🇪: 1.2%France🇫🇷: 2.3%Italy🇮🇹: 3.0%Spain🇪🇸: 4.0%Japan🇯🇵: 1.7% UK🇬🇧: 3.2%Canada🇨🇦: 3.4%China🇨🇳: 3.3%India🇮🇳: 7.4%Russia🇷🇺: -6.0%Brazil🇧🇷: 1.7%Mexico🇲🇽: 2.4%KSA🇸🇦: 7.6%Nigeria🇳🇬: 3.4%RSA🇿🇦: 2.3%https://t.co/ldMsaieJUU pic.twitter.com/Ip06Wct3s4
— IMF (@IMFNews) July 26, 2022
In 2023, the UK is projected to have the weakest growth of the world’s biggest economies, excluding Russia.
The IMF cut its global growth forecasts for this year to 3.2%, from a previous 3.6% projection.
It said growth in 2023 is now expected to reach 2.9%, cutting its guidance from 3.6%.
IMF economic counsellor Pierre-Olivier Gourinchas said: “The outlook has darkened significantly since April.
“The world may soon be teetering on the edge of a global recession only two years after the last one.”
It also warned that global inflation forecasts have worsened over the past quarter as consumer have been hit by rising food and energy prices.
Inflation is anticipated to rise by 6.6% in advanced economies, after a 0.9 percentage point increase to forecasts.
Meanwhile, developing economies are due to face a 9.5% inflation rate for the year.