- The Confederation of British Industry ( CBI ) forecasts a significant downturn for the UK economy, predicting faltering growth and worsening unemployment.
- The CBI anticipates an additional 200,000 people will become unemployed, pushing the jobless rate to 5.5 per cent this year, equating to approximately two million people.
- The organisation has also downgraded its growth projections for the next two years. UK Gross Domestic Product ( GDP ) is now expected to slow from 1.4 per cent growth last year to 1.1 per cent in 2026, further decelerating to 0.9 per cent in 2027 – a notable reduction from previous forecasts.
- This assessment is largely attributed to the effects of the Middle East conflict, which has pushed inflation above earlier forecasts, while higher energy prices , disrupted supply chains and increased uncertainty for businesses and consumers are all expected to impede economic growth.
- The CBI expects the Bank of England to maintain interest rates at their current level of 3.75 per cent for the remainder of the year.
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