Wednesday, November 30, 2022
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Britons to be £2,500 out of pocket with record level of inflation to hit – new figures

Interest rates are also set to increase and the UK GDP will fall, according to the Centre for Economics and Business Research [CEBR]. Their report looked into the possible impact of the Russian invasion of Ukraine on the UK economy.

The Bank of England interest rate is set to average 0.7 percent for the rest of 2022 and 1 percent for 2023 before then moving up to 1.25 percent.

According to the CEBR, the Bank of England “traditionally does not try to respond to one-off shocks”.

“In fact we expect that in the new environment there would be less tightening than we had previously calculated.”

The CEBR described the impact of the war on GDP as “dramatic”, due to the rise in the price of commodities and a reduction in exports globally due to economic sanctions on Russia.

The average household will lose around £2, 553 per year, as disposable incomes will fall by the largest amount since records began in 1995.

The UK GDP is expected to shrink significantly from 4.2 percent to 1.9 percent in 2022, and in 2023 from 2 percent to zero.

The report said: “Cumulatively, this is a reduction in GDP of more than £90 billion.”

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But this plan has “broken down as a result of Russia’s slow progress on the battlefield and immense diplomatic and public pressure on US and European leaders to maximise sanctions swiftly”.

Tory MP Robert Jenrick has warned Brits to prepare for “the most difficult economic year that we’ve seen in our lifetime”, reported the Daily Mail.

He admitted that the country could be facing “an energy crisis unrivalled since the 1970s” and said the government had to “level with the public that standing up to Putin could cause the most difficult year for household incomes”.

Global oil prices peaked at their highest level for 14 years this week, reaching $140 per barrel.



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