IMF: UK set for slowest growth of G7 economies in 2023

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According to the International Monetary Fund, the UK is going to have the lowest growth in the G7 next year.

The UK's growth is predicted to fall to just 1% in the next five years, much lower than its previous forecast.

The International Monetary Fund said that the global economy has shrunk for the first time since 2020.

The world may be on the edge of a global recession due to stalling growth in the UK, US, China and Europe.

The global growth forecast has been slashed by the International Monetary Fund and it warns that the situation could get worse.

It said fast-rising prices were to blame for much of the slowdown, with households and businesses squeezed by a combination of higher prices and higher borrowing costs.

Pierre-Olivier Gourinchas wrote that the global economy is facing an increasingly gloomy and uncertain outlook.

Since April, the outlook has darkened significantly, he said.

The global economy fell in the three months to July, the first decline since the Pandemic hit, according to the International Monetary Fund.

The probability of a recession in the G7 economies - Canada, France, Germany, Italy, Japan, the US and UK - is nearly four times higher than usual.

Inflation is expected to reach 6.6% in advanced economies and 9.5% in emerging market and developing economies by the International Monetary Fund.

Mr Gourinchas said that bringing inflation back to central bank targets should be the priority for policymakers.

"Tighter monetary policy will inevitably have economic costs, but it will only make things worse."

The aftermath of the war in Ukraine is felt in different parts of the globe. The International Monetary Fund sees more gloomy prospects for all major economies as a result of soaring food and fuel prices and higher interest rates.

Our dependence on fossil fuels, which make up 75% of our energy mix, makes us vulnerable to this shock. The international markets determine those prices. On the day that the energy price cap is set to top £3,000, a committee of MPs warns that more government help may be needed.

The UK faces more fundamental issues than the current crisis, with living standards having dropped behind many competitors over the last 15 years, something many attribute to a lack of investment in skills, equipment and infrastructure, according to the International Monetary Fund. The officials from the International Monetary Fund have told me that raising taxes is the best way to fund investment.

The US saw its rating slashed the most. The growth forecast for the world's largest economy has been slashed by the International Monetary Fund.

China's growth is expected to fall to 3.3% this year, the lowest rate in nearly four decades, as the country wrestles with a property crisis.

Questions about the reliability of Europe's natural gas supplies from Russia, as well as political unrest generated by high food and fuel prices, are among the risks the global economy is facing in the months ahead, according to the International Monetary Fund.

In a "plausible" scenario, in which only some of the risks materialise, global economic growth could fall to 2% next year, a pace the world has fallen below just five times since 1970.