The British economy begins to recover despite the world’s challenges

The International Monetary Fund has reported that the British economy has begun recovering after a significant slowdown in the second part of 2024, with Moment in the coming period.

According to the closing statement of Article 4 consultation, the British economy is expected to increase 1.2 percent in 2025 and 1.42 % in 2026. This support is the cause of a more simplest monetary policy and improves government spending in the October budget and improves consumer confidence.

However, the fund suggests that global trade tensions continue to throw its shadows on the economy, which reduces gross domestic product by 0.3 percent in 2026. This contraction is due to uncertainty and weak external demand, as well as the continuation of American fees.

The fund stressed that structural reforms, especially in the planning and infrastructure sectors, can significantly increase growth capabilities if effective implementation. Despite these efforts, the average growth is limited to 1.4 percent as long -term productivity is low.

Increase

Tightening the economic conditions and increasing precautionary savings for families, slowing down the consumption of private sector and undermining the restoration. By undermining the continuity of uncertainty in the global trade, the economy weighs by disrupting supply chains and reducing private investment.

With regard to public finance, in the next five years, in the next five years, the balance of government strategies is contributing to the growth and stability. Despite the increase in taxes, declared cost plans are reliable and inducing growth, taking into account public services and investment needs. It is expected to improve the income, deficit and improving the stability of net debt, but the fund warns that global risks and market fluctuations are calling for stringent commitment to the current path and will be prepared to take additional measures when needed.

In the long run, Britain is facing a growing economic stress, which requires difficulty decisions to resolve cost challenges and rebuild financial margins, and that by 2050, the government will increase by 8 percent, due to health costs and population pensions. Depending on the limited efficiency of borrowing, it is necessary to re -examine the state’s role in accordance with the priorities of increasing income or the priorities of the cost and the available resources.

The fund considers that the recent reforms of the economic frame are increasing its reliability and impact. The new financial balance base offers a wide capital space, while the debt base guarantees the management of economic stability. In addition to the periodic reviews of the three -year period, along with the periodic reviews of the cost, it is possible to increase the credibility of the economic chassis, and it is possible to gradually adapt to the shock.

Comfortable monetary policy

Gradually and comfortable approach to monetary facility is appropriate to support the economy and reduce the risk of inflation, which is expected to be higher between -2025 before the target in 2026. The Bank of England recover its budget and to maintain control and flexibility to activate the size facility when necessary.

The Fund believes that the British banking sector is a solid with sufficient capital and liquidity, progressing in assessing and monitoring the losses of the non -Bonking sector, which is more than half of the financial assets, and increases the market flexibility and continuous cooperation with the financial stability council. Bond market disturbances indicate the need to increase the elasticity of the government bond market, accurate monitoring, continuous stress tests, welcoming the issuance of short -term tools and improving market infrastructure.

The group recommends the budget of the financial sector reform when increasing the supervision of the Pension Regulations Authority and to prevent adverse effects such as competitive impacts, to ensure the stability of this sector carefully updating institutional frames and to ensure the stability of this sector.

When it comes to structural policies, growth slows down after the global financial crisis and exits Britain from the European Union and the addition of “Covid -19” and fuel crisis, such as “Kovid -19” and health problems, such as “Kovid -19” and health problems, such as “Kovid -19” and health problems such as “Kovid -19” and fuel crisis.

Accordingly; Britain requires comprehensive architectural reforms with priority and the tight sequence of procedures in the light of economic and external challenges. The growth on the development of political stability, capital, and the development of skills depends on the stability of trade policies, planning and improving the power of infrastructure and improving labor force. Industrial policy also plays auxiliary role, but the basis for increasing horizontal reforms, such as relieving planning limits.