Economy news: Tories fume as Brexit-doomsters at IMF forced to admit UK recession forecast is WRONG
Conservative MPs have lashed out after the International Monetary Fund (IMF) was forced to tear up a forecast which suggested the UK economy was about to enter a recession.
The IMF revised its forecast of the British economy earlier today to admit the UK would not enter a recession after all.
The organisation instead projected growth of 0.4 per cent, up from the 0.3 per cent contraction predicted last month.
The upgraded estimate was well-received by Tory MPs but many warned it raised questions about how the IMF was analysing Britain’s economic prospects post-Brexit.
The organisation instead projected growth of 0.4 per cent, up from the 0.3 per cent contraction predicted last month
PA
Lichfield MP Michael Fabricant, who previously served as Lord Commissioner of the Treasury, told GB News: “Yet again, the IMF have underestimated the UK’s economic resilience [by] reversing their projections which originally projected we would be in recession.
“With Britain’s economy forecast to grow faster than Germany, this will be a welcome boost for Rishi Sunak and those of us who always supported leaving the EU.”
A senior Conservative minister added: “It was never as bad as everyone peddled.
“We could see the long-term price drop on energy months ago … but optimism breeds success.”
A third Tory MP claimed: “The only problem is that the IMF are never right but the Remoaners will always want to talk us down.”
The view of the London skyline from Windows Bar in central London
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David Campbell-Bannerman, who sat as a Conservative and UKIP MEP in Brussels from 2009 to 2019, also told GB News: “The IMF is now run by a former EU Commissioner in [Kristalina] Georgieva; following on from Christine Lagarde.
“Is it any wonder with such EU enthusiasts in charge that the IMF has downplayed Brexit Britain’s economic strength?”
A source from the Brexit-backing European Research Group added: “The reality is that both the Bank of England and the IMF continue to fail in their prime objectives.
“It is no wonder that people continue to pay less and less attention to their forecasting.
“Away from all the wild hysteria, Brexit Britain continues to be resilient despite all the attempts to talk down this country.”
Chancellor of the Exchequer Rishi Sunak previously meeting with International Monetary Fund (IMF) Managing Director Kristalina Georgieva
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The IMF’s upgraded economic outlook for the UK indicated Britain would not enter recession and will no longer lag behind competitors as the worst performing nation in the G7.
Germany, the largest economy in the European Union, instead languishes behind G7 rivals with a forecast contraction of 0.1 per cent.
However, France and Italy look set to witness growth of 0.7 per cent as Japan, Canada and the United States push ahead with growth ranging from 1.3 per cent to 1.6 per cent.
Addressing the UK’s economic situation, the IMF said: “Buoyed by resilient demand in the context of declining energy prices, the UK economy is expected to avoid a recession and maintain positive growth in 2023.”
Sunak, who became Prime Minister after Liz Truss’ turbulent 49-day stint in Downing Street, was also praised by IMF managing director Kristalina Georgieva.
Lichfield MP Michael Fabricant, who previously served as Lord Commissioner of the Treasury, spoke to GB News
GB News
Georgieva said: “The UK authorities have taken decisive and responsible steps in recent months.
“What we see is that the Government is prioritising, and rightly so, the fight against inflation.”
Inflation is expected to fall to five per cent by the end of the year after reaching double digits in March.
The figure should return to the Bank of England’s two per cent target by the middle of 2025, the IMF claimed.
The IMF also predicted that the UK’s economy would grow by one per cent in 2024 and by two per cent in the following two years.
Chancellor Jeremy Hunt, who warned the IMF’s pessimistic April prediction was wrong, welcomed the latest development
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Growth is then expected to return to a long-run growth rate of around 1.5 per cent.
Chancellor Jeremy Hunt, who warned the IMF’s pessimistic April prediction was wrong, welcomed the latest development.
He said: “This is a decisive vote of confidence in the UK’s economic management.
“We now need to keep a tight focus on our plan to halve inflation, grow the economy and reduce debt.”
However, the IMF was considered a thorne in the side of the Brexit campaign back in 2016 after it warned the “negative and substantial” effects of the UK leaving the European Union would plunge Britain into a recession.
