UK faces biggest hit to growth from Iran war of major economies, IMF says

"The IMF cut its estimate for UK growth this year to 0.8%, from the 1.3% prediction made in January before hostilities began, due to the war and higher energy prices."

"The UK's downgrade of half a percentage point is the largest of the world's advanced economies, with the UK now earmarked to have middling growth this year compared to its peers."

"The IMF warned the war threatened to throw the world economy 'off course' and a prolonged conflict risked a global recession, urging central banks to be cautious over raising interest rates."

"The UK is forecast to have the joint highest inflation in the G7 this year, of 3.2%, and next, of 2.4%, alongside the US in 2026 and Italy in 2027."

The IMF has reduced the UK's growth estimate for this year to 0.8% from 1.3% due to the Iran war and rising energy prices. The UK is expected to face the largest downgrade among advanced economies, with inflation projected to reach 3.2% this year. The IMF warns that the ongoing conflict could lead to a global recession and advises caution in raising interest rates. Despite the current challenges, the UK is anticipated to recover and become the fastest growing economy in the G7 next year, albeit at a slower growth rate of 1.3%.

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