IMF lifts UK growth forecast but expects slowdown in 2027
The fund has upgraded its forecast for UK growth this year, but expects the economy to slow in 2027 as energy prices and long-term interest rates weigh on spending and investment.
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The International Monetary Fund has raised its forecast for UK economic growth in 2026 to 1.3%, up from the 1% it predicted in July, BBC News reported on 13 October. But the fund expects growth to slow to 1.2% in 2027, when it says higher energy prices and long-term interest rates will weigh on household spending and business investment. [1]
BBC News reports that the IMF expects inflation to average 3.3% in 2026 and reach 2.8% in 2027. That would still leave it above the Bank of England’s 2% target next year, even as the rate of price rises eases. [1]
According to BBC News, the IMF said economies had proved more resilient to the energy-price shock caused by the US-Iran war. It also warned that the conflict’s economic fallout remained “highly uncertain”. [1]
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