With demand recovering as energy prices fall, the UK economy is expected to avoid recession and maintain positive growth into 2023, according to the IMF.
The UK will not be the world's slowest growing major economy by 2023, according to forecasts from the International Monetary Fund (IMF).
Meanwhile, Germany, as Europe's largest economy, will have the worst growth among the Group of Seven (G7) leading industrialized nations.
The IMF said the UK economy would grow by 1% next year as inflation slows and then average around 2% in 2025 and 2026.
However, IMF officials also warned that inflation would only fall to 2% in the next three years and there was a risk that prices could remain higher for longer.
The figures came after IMF officials ended a two-week visit to Britain to assess the state of the economy ahead of its annual review.
With demand recovering as energy prices fall, the UK economy is expected to avoid recession and maintain positive growth into 2023, according to the IMF.
UK finance minister Jeremy Hunt said the IMF forecast was a major upgrade to the UK's growth outlook and credited the government 's actions in restoring stability and containing inflation.
The IMF's forecast for an upgrade in the UK economy is in line with other major institutions, including the Bank of England, which has ruled out a recession in 2023.
Previously, the British government and ruling Conservative Party MPs criticized the IMF for repeatedly underestimating the UK economy's ability to recover after Brexit .
The IMF assessed that the British government and the BoE had acted “resolutely to fight inflation,” pointing out that the BoE was one of the first banks to start raising interest rates in late 2021.
However, inflation has proven more persistent than expected this year, as food prices have hit record highs.
New inflation figures due on May 24 will show the first major decline in consumer prices to around 8.4% from 10.1% recorded in March 2023./.
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