UK economy is already in recession

UK encounters energy supply difficulties

Affected by the conflict between Russia and Ukraine and the high temperature and dry weather in summer, the United Kingdom encountered energy supply difficulties this summer, the cost of power generation has risen sharply, and the electricity bills of the British people have risen steadily. In the case of rising energy prices, the inflation level of the United Kingdom has also risen, and it has become the first country among the major developed economies to break the double-digit inflation level.

Worries about the UK economic outlook are expected to weigh on the pound

The pound's recent fall may reflect investor concerns about headwinds facing the UK economy. GBP/USD posted its worst monthly performance in six years in August. Trading hours in the UK this week were cut short by a bank holiday, and so far there has been no real major macroeconomic news to justify the pound's underperformance, the research said.

The downside risk of the UK economy is increasing

According to estimates by Citi, the consumer price index in the UK is expected to exceed 18% in early 2023, and the retail price index inflation rate will even soar to 21%. In the face of heavy upward pressure on inflation, the Bank of England seems to have no better choice than to continue raising interest rates.

The UK economy is already in recession

The UK economy is already in recession, and UK inflation is expected to hit 14% by the end of the year. That will put more pressure on Britain's new prime minister to act quickly to avoid economic catastrophe. The U.K. economy is expected to contract for two consecutive quarters after shrinking in the second quarter, and is expected to recover only slightly by 0.2% next year.

The new Prime Minister of the United Kingdom will be announced

The new British Prime Minister will be announced next Monday. It is widely expected that Truss will become the new British Prime Minister, and the pound may face the risk of falling; traders bet that the Bank of England will raise interest rates by 275 basis points by May next year. 4.5%; investors are continuing to weigh broader themes, notably the threat of sluggish U.K. economic growth with high or stagnant inflation, and uncertainty around potential policy changes under a new cabinet.

Goldman Sachs analysts say the economy has no soft landing, the stock market will continue to fall

Goldman Sachs said the economic soft landing that the equity bull market was hoping for is unlikely given the risk of persistently higher inflation and a global slowdown. While major stock indexes have fallen sharply so far this year, they are set to fall further to absorb inflation remaining elevated for longer and global downside risks to growth in the U.S. and Europe. Markets will price in more recession risks before the economy actually improves. "The jobs data is not something to be happy about for stock bulls. Continued strength in the labor market will lead to higher inflation expectations and encourage the Fed to "stick to" its determination to raise interest rates and restore price stability.

Target cost of living support to poor families

Chancellor of the Exchequer Zahavi: We need to target cost of living support to poor families. For the next prime minister, there are no easy options when it comes to life support. Whatever options we choose for life support, it has to be feasible. The solution to rising wages cannot depend solely on the level of inflation. We must send a clear message to Putin that his strategy will not work.

A new strain of monkeypox was discovered in the UK

British health officials have confirmed that a new strain of monkeypox has been found in the UK, Sky News reported. The UK's Health Security Agency announced that a person who had recently travelled to West Africa and was hospitalised had been diagnosed with a different variant of the monkeypox virus currently circulating. The bureau said that as of September 1, no other cases had been identified and that the Ministry of Health Security was looking for its close contacts.