London Daily

Focus on the big picture.
Monday, Sep 08, 2025

IMF slashes UK growth outlook, adding pressure on finance minister Hunt

IMF slashes UK growth outlook, adding pressure on finance minister Hunt

Britain is the only Group of Seven nation to have suffered a cut to its 2023 economic growth outlook in International Monetary Fund forecasts published on Tuesday, adding to pressure on finance minister Jeremy Hunt to come up with a growth plan.
Britain's flagging economy now looks set to shrink by 0.6% this year, a sharp downgrade from previously expected growth of 0.3% in the IMF's last forecast in October.

All other G7 economies are predicted to grow this year, mostly at a stronger pace than the IMF forecast three months ago.

The IMF said Britain would struggle with a combination of factors including higher taxes announced by Hunt late last year as he tried to restore the confidence of investors after September's "mini-budget" of former prime minister Liz Truss.

Britain had also been hit particularly hard by the surge in gas prices after Russia's invasion of Ukraine as it relied on gas for much of its power generation, and it faced a shortage of workers too that was holding back the economy, the IMF said.

The Bank of England's sharp increase of interest rates to try to stamp out the risks from a jump in inflation would take its toll as well.

"All these factors taken together lead to a fairly sharp retrenchment of activity in 2023," Pierre-Olivier Gourinchas, the IMF's chief economist, told reporters.

By contrast, Britain is expected to have registered one of the highest growth rates in 2022 among European countries at 4.1%, Gourinchas said.

Petya Koeva-Brooks, deputy director of the IMF's research department, said Britain had a higher share of share of variable rate mortgages than countries such as the United States.

"So again, the transmission of monetary policy is much more immediate and quick," she said.

Britain is the only economy in the G7 not to have recovered its pre-pandemic size with Brexit widely seen as unique drag among its peers.

Responding to the IMF report, Hunt said nearly all advanced economies were facing headwinds, and that past forecasts from a range of bodies including the IMF had proven too gloomy about Britain's prospects.

"Short-term challenges should not obscure our long-term prospects," he said.

Hunt is due to announce measures that he hopes will speed up growth in a budget statement on March 15. Several senior members of the ruling Conservative Party want him to cut taxes immediately.

Last week, Hunt signalled he would stick with his tax hikes but said Brexit would help Britain to become a leader in fast-growing sectors such as the digital technology and green energy while reforms of the labour market would also boost growth.

For 2024, the IMF predicted Britain's economy would grow by 0.9%, a 0.3 percentage point increase from October's forecast but still the joint slowest in the G7 with Japan and Italy.
Newsletter

Related Articles

0:00
0:00
Close
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
Elon Musk Poised to Become First Trillionaire Under Ambitious Tesla Pay Plan
France, at an Impasse, Heads Toward Another Government Collapse
Burning the Minister’s House Helped Protesters to Win Justice: Prabowo Fires Finance Minister in Wake of Indonesia Protests
Brazil Braces for Fallout from Bolsonaro Trial by corrupted judge
The Country That Got Too Rich? Public Spending Dominates Norway Election
Nearly 40 Years Later: Nike Changes the Legendary Slogan Just Do It
Generations Born After 1939 Unlikely to Reach Age One Hundred, New Study Finds
End to a four-year manhunt in New Zealand: the father who abducted his children to the forests was killed, the three siblings were found
Germany Suspends Debt Rules, Funnels €500 Billion Toward Military and Proxy War Strategy
EU Prepares for War
BMW Eyes Growth in China with New All‑Electric Neue Klasse Lineup
Trump Threatens Retaliatory Tariffs After EU Imposes €2.95 Billion Fine on Google
Tesla Board Proposes Unprecedented One-Trillion-Dollar Performance Package for Elon Musk
US Justice Department Launches Criminal Mortgage-Fraud Probe into Federal Reserve Governor Lisa Cook
Escalating Drug Trafficking and Violence in Latin America: A Growing Crisis
US and Taiwanese Defence Officials Held Secret Talks in Alaska
Report: Secret SEAL Team 6 Mission in North Korea Ordered by Trump in 2019 Ended in Failure
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Florida Murder Case: The Adelson Family, the Killing of Dan Markel, and the Trial of Donna Adelson
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Big Tech Executives Laud Trump at White House Dinner, Unveil Massive U.S. Investments
Tether Expands into Gold Sector with Profit-Driven Diversification
‘Looks Like a Wig’: Online Users Express Concern Over Kate Middleton
Brand-New $1 Million Yacht Sinks Just Fifteen Minutes After Maiden Launch in Turkey
Here’s What the FBI Seized in John Bolton Raid — and the Legal Risks He Faces
Florida’s Vaccine Revolution: DeSantis Declares War on Mandates
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
"The Situation Has Never Been This Bad": The Fall of PepsiCo
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
The Fashion Designer Who Became an Italian Symbol: Giorgio Armani Has Died at 91
Putin Celebrates ‘Unprecedentedly High’ Ties with China as Gazprom Seals Power of Siberia-2 Deal
China Unveils New Weapons in Grand Military Parade as Xi Hosts Putin and Kim
Queen Camilla’s Teenage Courage: Fended Off Attempted Assault on London Train, New Biography Reveals
Scottish Brothers Set Record in Historic Pacific Row
Rapper Cardi B Cleared of Liability in Los Angeles Civil Assault Trial
Google Avoids Break-Up in U.S. Antitrust Case as Stocks Rise
Couple celebrates 80th wedding anniversary at assisted living facility in Lancaster
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
The White House on LinkedIn Has Changed Their Profile Picture to Donald Trump
"Insulted the Prophet Muhammad": Woman Burned Alive by Angry Mob in Niger State, Nigeria
Trump Responds to Death Rumors – Announces 'Missile City'
Court of Appeal Allows Asylum Seekers to Remain at Essex Hotel Amid Local Tax Boycott Threats
Germany in Turmoil: Ukrainian Teenage Girl Pushed to Death by Illegal Iraqi Migrant
United Krack down on human rights: Graham Linehan Arrested at Heathrow Over Three X Posts, Hospitalised, Released on Bail with Posting Ban
Asian and Middle Eastern Investors Avoid US Markets
Ray Dalio Warns of US Shift to Autocracy
Eurozone Inflation Rises to 2.1% in August
Russia and China Sign New Gas Pipeline Deal
×