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UK faces ‘sobering’ economic outlook, IMF warns

Thursday, 12 January 2023 6:34 PM [ Last Update: Thursday, 12 January 2023 7:48 PM ]

The International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, US, September 4, 2018. (Photo by Reuters)

The International Monetary Fund says Britain faces a "sobering" economic outlook for 2023, as the country experiences a torrid time in the coming months in what is going to be the worst cost-of-living crisis in living memory.

"The announced fiscal plan navigates well the difficult trade off between fighting inflation and protecting household incomes in a recession primarily caused by the exogenous energy price shock," the IMF said in a statement released by the House of Commons' treasury committee on Thursday.

"The outlook for the UK economy is sobering: for 2023, output is expected to contract and inflation to remain elevated."

However, Harriett Baldwin, the Conservative lawmaker and treasury committee chair, said she was unhappy that senior IMF officials had so far declined her committee's invitation to testify before her. "I'm concerned that the IMF is in an untenable position, offering commentary to journalists but not being prepared to follow up with appearances before elected politicians."

Experts say the year 2023 will be a year of great economic strides for the UK.

Third of UK citizens would struggle to find extra £20 amid economic crisis: Poll

More than a third of UK citizens would find it difficult or impossible to find extra £20, a research shows.

The inflation rate stands at a 41-year high of 11.1% amid soaring food and energy prices.

The government has blamed the war in Ukraine and the Covid-19 pandemic as the main culprits in the economic downturn.

A leading think-tank recently said the worst impact of the cost-of-living crisis in the UK is yet to hit the already struggling Britons, warning that families across the UK have only experienced half of the lost income they are expected to suffer during 2023.

The Resolution Foundation think-tank has suggested in its newly published survey that the average household across the UK will be left £2,100 worse off by the end of the next financial year.

Due to the worsening cost-of-living crisis, Britons have been staging industrial actions nationwide, seeking a pay raise to cope with the soaring inflation, which has risen to about 11 percent.

The wave of strikes has been the biggest over the past decades, with airport baggage handlers, border staff, driving instructors, bus drivers, and postal workers walking off their jobs to demand higher pay. Nurses and ambulance workers are also locked in an intense dispute with the National Health Service (NHS) as they seek payment raises and better conditions.

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