Displaying items by tag: recession

Bank of England governor Andrew Bailey, addressing MPs, has expressed optimism about the UK economy despite a recent shallow recession. He noted 'distinct signs of an upturn’, foreseeing one of the mildest recessions in modern history. The Bank's measures, including fourteen consecutive interest rate hikes, aimed to bring inflation back to 2% to help allow for sustainable growth. The bank’s reluctance to cut interest rates reflects worries over the outlook for inflation later in the year. Bailey cautioned against complacency, citing uncertainties such as energy costs and shipping disruptions. Asked about the timing of cuts in the interest rate, he refused to say when or by how much this might happen: his deputy said this would be based on ‘data not dates’.

In 2023, the UK officially entered a recession, as confirmed by the Office for National Statistics (ONS). The economy shrank by 0.3% in the last quarter of 2023, marking the second consecutive quarter of decline, a typical indicator of recession. However, there are positive signs, with a robust job market and wage growth surpassing inflation, suggesting a potential short duration for the downturn. The UK's GDP grew by a slight 0.1% compared to the previous year, indicating weak but present growth. Chancellor Jeremy Hunt remains optimistic, believing the economy is improving, despite current low growth rates. In contrast, Shadow chancellor Rachel Reeves criticised Rishi Sunak, claiming his economic growth promises are failing. The global context shows similar trends, with the EU narrowly avoiding a recession and Japan entering one. The latest ONS update confirmed a marginal 0.1% GDP growth for the UK in 2023, the weakest since the 2009 financial crisis, excluding 2020's pandemic impact. The Government's focus is on reducing inflation and supporting economic recovery, amidst political criticism and global economic challenges.

The International Monetary Fund (IMF) predicts the UK economy will shrink this year while every other major economy will grow. The Bank of England also forecasts a 2023 recession - albeit shorter and less severe than previously forecast. Forecasts are never perfect. There are many factors affecting economic growth, from geopolitics to the weather. Predictions often miss the mark but can point in the right direction. UK's figures reflect the impact of closed schools, cancelled operations during Covid, as well as disruption due to strikes. The bigger picture, however, remains: the Bank of England and the IMF both expect the UK economy to shrink this year, while other G7 countries are expected to grow. There are ten million working-age people who aren't in a paid job. Nearly nine million of them aren't called ‘unemployed’ because they're not actively looking for work, or available to start a job. Instead they are called ‘economically inactive’.

The Bank of England has raised interest rates to 2.25%, the highest level for 14 years. This will make it more expensive to borrow, which should - theoretically - encourage people to borrow less and spend less. It should also spur people to save more. However, there is also a risk that it can drag on growth, harming the economy. The bank's monetary policy committee, which sets rates, believes that the economy is already shrinking, which would officially push the UK into recession. The Bank of England has also warned that the government’s energy price freeze will push up inflation in the medium term. With energy bills rising less sharply, households will have more money to spend on other goods and services (although some people are already having to skip meals due to rising bills).

Companies were forced to give bribes to cajole employees to return to the office last year: free breakfast, ice cream and even popcorn to workers who came in. Now bribes are replaced with stern summons issued to workers still wanting to stay at home. Apple’s chief executive ordered every employee to return to the office three days a week from September. That is the latest in similar demands issued by other companies, who all feel that office life improves productivity. But efforts to lure staff back may not be necessary when the country plunges into recession. Experts and City professionals are now saying workers are keen to get back in front of managers to save their jobs as a crisis looms. However, as the harsh reality of the cost-of-living crisis hits, they will still have to escort some of their colleagues to the door anyway.

Public finances are under pressure from a predicted recession. Both PM candidates agree that people will need help with the cost of living this autumn, but tax cuts will only bring relief to taxpayers. Cutting health and social care levies gives no money to pensioners or anyone earning less than £12,570. The new prime minister will not start the job for another four weeks. The candidates are coming under increasing pressure to spell out their plans. Gordon Brown recently said an emergency budget was urgently needed and that Boris Johnson, Ms Truss and Mr Sunak must agree on one now. A financial time bomb will explode with the October energy price cap. Loughborough University’s Prof Hirsch said, ‘It is urgent for the next prime minister to ensure families have enough to live through this crisis and beyond.’ Some will be £1,600 worse off per year. On 11 August government ministers met with energy giants, focusing on how energy companies can alleviate pressure on consumers: see

The Bank of England has raised interest rates to 1.75%, the biggest rise in 25 years, as it predicts an even higher peak in inflation of 13%. It fears inflationary pressures are becoming ‘more persistent and broadening’. Many companies have been successfully raising prices which will push up consumer costs in the shops. The latest rise in gas prices has led to another significant deterioration in the financial outlook as the UK is now projected to enter recession. The bank has forecast that the UK economy will start shrinking in the fourth quarter of this year, and then keep contracting through next year. That would be the longest recession since after the 2008 financial crisis. The bank also points to the UK’s ‘tight’ labour market - a signal that it is worried about a wage-price spiral, as workers seek pay rises to help with the worst cost of living crisis in decades.

The UK could be heading for a recession. The economy contracted by 0.1% in March, and higher prices are ‘really beginning to bite’, the Office for National Statistics said. People are spending less in shops and cutting down on car journeys; the impact of higher energy bills in April has also yet to be seen. Many price rises are just starting to hit households now. Last week the Bank of England forecast that inflation could reach more than 10% by the end of the year. It warned the UK faces a ‘sharp economic slowdown’. The chancellor has threatened to hit energy companies with a one-off ‘windfall’ tax if they don't invest enough in new projects. Opposition parties want to tax the soaring profits of oil and gas firms to help families grappling with rising bills. Treasury officials have been ordered to examine a potential tax, and Boris Johnson said the Government would have to look at the windfall proposal if not enough investment was made.

The economic outlook across the Eurozone has deteriorated in 2019 as the probability of the entire Euro area falling into recession increases. Italy is in an officially-declared recession, and data suggest that Germany, France, and the broader EU are not far behind. Italy and the Netherlands showed industrial production plunging. In the past journalists, pollsters, and academics have debated over whether a recession creates a boom in attendance at evangelical churches. The church is not immune; often ministries in times of recession are forced by lower giving or higher costs (or both) to reconsider where their funds should go and what they need to change to make the most of their resources. See also https://www.christianitytoday.com/ct/topics/e/economic-crisis-recession/

Economic experts warn that Scotland could be entering a recession. Scottish GDP performance lags behind the rest of Britain. Experts at the Fraser of Allander Institute say that the debate about Scotland's economy could easily be side-tracked by constitutional wrangling and discussions around the prospects for a second independence referendum. They fear politicians will use Brexit as an excuse for not undertaking an urgent and frank assessment of the best policies to support the Scottish economy. On the ecclesiastical front Scotland is becoming a post-religious society, with a clear majority of people abandoning organised faith. Six out of ten Scots identify as having no religion, while dwindling congregations and other societal factors have seen scores of church buildings disappear - many now existing only in battered photographs and distant memories. See