UK to enter recession in Q4 amid energy crisis: Goldman

UK to enter recession in Q4 amid energy crisis: Goldman
  • Goldman Sachs predicts a significant decrease in British economic growth.
  • The United Kingdom (UK) experienced a record high inflation in June.
  • The main drivers of inflation in the UK are energy prices.

Goldman Sachs economists are forecasting a severe decline in British growth later this year, attributing the problem to inflation which has reduced the amount of disposable income for families. The investment bank has downgraded its growth forecast for the UK economy from 1.4% to 0.6%.

With each passing day, the macro-world economy gets worse. Consumers’ purchasing power has decreased, while producers have been tolerating low demand. The combination of the two is a recipe for disaster, and it seems that Goldman Sachs has lost confidence in the UK economy’s ability to rebound.

According to recent news, The United Kingdom (UK) experienced a record high inflation in June. The consumer price index rose to 10.1 percent from 9.4%, according to the Office for National Statistics. notably, the figure was greater than expected, with a result of 9.8%. This was the UK’s highest inflation rate in nearly 40 years.

The main drivers of inflation in the UK are energy prices, which have risen sharply in recent months. The cost of petrol has increased by 20% in the past year, while the price of electricity has gone up by 10%. These rising costs have put a squeeze on consumers’ budgets, and it is now starting to show in the economy.

According to the investment bank, the recession prospects are unlikely to deter the Bank of England from further tightening monetary policy. It expects a 50 basis-point rate increase in September and “upside risks” to its call for quarter-point increases in November and December.

Tags:
disclaimer read more

Crypto News Land (cryptonewsland.com) , also abbreviated as “CNL”, is an independent media entity — we are not affiliated with any company in the blockchain and cryptocurrency industry. We aim to provide fresh and relevant content that will help build up the crypto space since we believe in its potential to impact the world for the better. All of our news sources are credible and accurate as we know it, although we do not make any warranty as to the validity of their statements as well as their motive behind it. While we make sure to double-check the veracity of information from our sources, we do not make any assurances as to the timeliness and completeness of any information in our website as provided by our sources. Moreover, we disclaim any information on our website as investment or financial advice. We encourage all visitors to do your own research and consult with an expert in the relevant subject before making any investment or trading decision.

Godfrey Mwirigi is an enthusiastic crypto writer with an interest in Bitcoin, blockchain, and technical analysis. With a focus on daily market analysis, his research helps traders and investors alike. His particular interest in digital wallets and blockchain aids his audience in their day-to-day endeavors.

programmer & freelance writer