Wednesday, 20 December 2017

IMF downgrades UK growth forecast on Brexit uncertainty, chief Christine Lagarde says

The IMF has cut its UK economic growth forecast, blaming Brexit uncertainty.

The Fund expects growth of 1.6% this year, down slightly from its previous forecast of 1.7%. It expects growth to slow further next year, to 1.5%.

IMF chief Christine Lagarde said uncertainty over the Brexit deal was causing UK firms to delay investment plans.

She also said rising inflation, caused by the fall in the pound, and stagnant wages were squeezing spending power.

Ms Lagarde said that the government had made "significant progress" in reducing the deficit.
But she added that relative to growth in the rest of the world, "the UK is losing out as a result of higher inflation, pressure on wages and incomes and delayed investment".

"If you look at investment alone, with 2.1% of GDP in investment, with the global economy as it is, and the space the UK economy has in that global economy, it should be rolling at 6%."

BBC          News.