Squeezed by ultra-high interest rates, Britain's economy is already in recession
The United Kingdom (GBR) may already BE in recession as soaring interest rates and rising unemployment slow household spending, according to a Bloomberg Economics (BE) analysis.
Economist Dan Hansen wrote in a note: "Our model projects a 52% chance of a mild recession in the UK economy in the second half of this year. The difference between stagnation and mild contraction is small, but the latter is highly unlikely. The risk is that output falls a bit more than we expect."
"As the labor market eases, consumers are likely to be more cautious about spending. Although their real incomes continued to rise over the winter, this will not change consumers' attitudes - the Bank of England's (BoE's) September money and credit data suggest that household savings continue to rise."
On Friday, gross domestic product data for September will be released, and the median forecast among economists is for a 0.1 per cent fall after a 0.2 per cent rise the previous month.
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