The supply shock continues for the United Kingdom

The last week has delivered little let-up in the energy price-driven supply shock to the UK economy triggered by Russia’s invasion of Ukraine. Inflation is set to rise above 8% later in the spring and we have downgraded our forecast for GDP growth this year and next.

What you will learn:

• The possibility of the Chancellor announcing measures to support households in the Spring Statement on March 23 could moderate the hit to economic activity and cap inflation, although to what extent is the big unknown.
• Meanwhile, that the economy more than made up Omicron-related losses in January meant it entered the current crisis with a degree of momentum.