ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The UK economy will shrink and perform worse than other advanced economies, including Russia, as the cost of living continues to hit households, the International Monetary Fund has said. The IMF said the economy will contract by 0.6% in 2023, rather than grow slightly as previously predicted.

Detailed explanation-2: -The BCC expects UK economy to avoid a technical recession but shrink by 0.3% in 2023, before returning to growth in 2024; inflation will slow to 5% by Q4 2023. The British Chambers of Commerce (BCC) forecasts the economy will not return to its pre-pandemic size until the final quarter of 2024.

Detailed explanation-3: -The British economy will contract by 0.6% in 2023, according to the International Monetary Fund (IMF). According to its World Economic Outlook Update, published on 31 January, that will make the UK the only large economy to shrink this year.

Detailed explanation-4: -Nevertheless, GDP growth, even under a more optimistic scenario, is expected to remain around 0% in 2023. Growth prospects in subsequent years appear relatively weak, weighed down by the UK’s long-standing problem of a productivity growth slowdown growth.

Detailed explanation-5: -The Bank of England projects that the British economy has entered a shallow recession in the first quarter of 2023 that will last for five quarters, however, as energy prices remain high, and rising market interest rates restrict spending.