UK economy will go into stagnation later this year, with the risk that it could turn out to be a deep contraction as energy costs soar, the American multinational investment bank Goldman Sachs Group, expected on Monday.
The UK’s gross domestic product expected to decrease by one percent through until the middle of 2023, Goldman said in a research. The Annual output next year will probably to fall by 0.6 percent.
Goldman’s predictions coincide data last week showed economic activity weakened from the US to Europe and Asia. Moreover, this reinforcing concerns about rising interest rates as well as the elevated inflation could tip the world into an economic recession.
The Bank of England (BOE) made its biggest interest-rate rise in 27 years this month. The possible recession unlikely to hinder the BOE from tightening monetary policy further, Goldman added.
Gas prices may remain elevated for longer, according to the economists.
However, it expects a 50 basis-point rate rise in September.