IMF slashes UK 2017 growth forecast to 1.1%

The International Monetary Fund (IMF) has trimmed UK growth forecasts for 2017 further to 1.1 percent citing the EU referendum result.

The IMF also said on Tuesday that it expects the UK to grow at 1.8 percent for 2016 – a mild higher from the 1.7 percent it forecast in its July update.

In July following the 23 June referendum, the IMF cut its 2016 GDP growth forecast for the UK from 1.9 percent to 1.7 percent and the 2017 forecast from 2.2 percent to 1.3 percent.

Today it has cut the 2017 forecast further to 1.1 per cent, although it has revised up 2016 growth forecast to 1.8 per cent on the back of stronger than expected growth in the second quarter of the year.

The Fund said it has also revised down its medium term GDP growth potential forecasts for the UK from 2.1 percent to 1.9 percent due to the expectation that lower migration, trade and capital flows would take a toll.