UK to face ‘worst, longest’ recession among G7 countries in 2023

MOSCOW — The United Kingdom will face one of the longest recession and weakest recovery among G7 countries throughout 2023 due to long-term inflationary effects of the pandemic and conflict in Ukraine, reported Sputnik.

According to economists interviewed by the Financial Times newspaper, the UK would face a longer period of “inflationary shock” than most of G7 states, which would force the government to conduct a strict fiscal policy throughout 2023.

“The combination of falling real wages, tight financial conditions and a housing market correction are as bad as it gets,” Kallum Pickering, senior economist at Berenberg bank, said, as quoted by the news outlet.

The UK economy is “unusually exposed” to a worldwide surge in energy prices and interest rates as the country’s demand for gas hardly matches storage capacity and a large number of mortgage deals will have to renew fixed-rate contracts, the report noted.

The UK has been experiencing an economic crisis over the past months. According to the Bank of England, the UK economy has entered a recession expected to last until the second half of 2024. —BERNAMA