Rolling coverage of the latest economic and financial news
- Risk of UK recession at next general election is 60%, says thinktank
- Chinese economy slips into deflation as recovery falters and demand slows
NIESR’s economic forecasts suggest Rishi Sunak will fight the next election against a backdrop of an economy suffering from five years of lost growth and a widening of the gap between the prosperous and less well off parts of Britain.
Our economics editor Larry Elliott explains:
The National Institute of Economic and Social Research (NIESR) said it would take until the third quarter of 2024 for UK output to return to its pre-pandemic peak and that there was a 60% risk of the government going to the polls during a recession.
In its quarterly update on the state of the economy, the NIESR said the poorest tenth of the population had been especially hard hit by Britain’s cost of living crisis and would need an income boost of £4,000 a year to have the same living standards they enjoyed in the year before Covid-19 arrived.
In an update published overnight, our European bank analysts estimate that such a cap would reduce the overall size of the tax by over 40%, though it would still take more than 10% from 2023 profits.
