How has Britain avoided a recession?

For the past 18 months, the UK economy has been stuck in the purgatory of an eternally predicted but non-arriving recession. The Office of Budgetary Responsibility (OBR), Bank of England, and the IMF have been among those to have predicted recessions that have not – yet – happened.

But now, for what it is worth (which, to judge by the history of economic forecasting, is not much), one often-pessimistic body has stuck its neck out and said that Britain will avoid a recession. The EY Item Club has upgraded its forecast for economic growth across 2023 from 0.4 per cent to 0.6 per cent. Next year, it says that growth will be 0.7 per cent, and in 2025, 1.7 per cent. It also forecasts that inflation will fall to 4.5 per cent by the end of this year and 2 per cent by the end of 2024 – that would return it to the Bank of England’s target.

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Ross Clark

Britain is living beyond its means

As ever, it is best to take such predictions with a pinch of salt.