"The National Institute of Economic and Social Research has warned that the Middle East energy shock could wipe around £35bn from the UK economy over the next two years, even if tensions ease relatively quickly."
"Under its central outlook, the UK economy is now expected to grow by just 0.9pc in 2026, down sharply from previous forecasts, with only a modest recovery to 1pc in 2027."
"Wage growth is predicted to lag behind prices, with earnings expected to rise by around 3.3pc next year, leaving many families facing a fresh hit to real incomes."
The National Institute of Economic and Social Research warns that the Middle East energy crisis may shrink the UK economy by £35bn over the next two years. A prolonged conflict could lead to recession, with growth expected to be only 0.9% in 2026. Inflation is projected to rise to 4.1% early next year, with the Bank of England potentially raising interest rates to 5.25%. Real disposable income growth will slow, particularly affecting lower-income households reliant on energy and essentials.
Read at London Business News | Londonlovesbusiness.com
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