Owning a home is getting more expensive as lenders begin putting up mortgage rates, spooked by stubbornly high inflation figures.
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The Bank of England is under even more pressure to raise interest rates again in response, possibly as high as five-and-a-half per cent.
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The UK economy has been one of the strongest in Europe over the last decade. However, recent economic indicators suggest that the country is preparing for a recession amid rising interest rates.
Interest rates in the UK have remained at historic lows since the financial crisis in 2008. However, the Bank of England increased the base rate in August 2018 for the first time in a decade from 0.5% to 0.75%. This move was made to control inflation, which has been above the Bank’s target of 2%.
While the increase in interest rates is intended to bring down inflation, it has caused concerns that the cost of borrowing will rise, making it harder for individuals and businesses to access finance. The Bank of England has warned that house prices could fall by up to 35% over the next three years if the UK fails to secure a deal with the EU.
The UK government has been taking steps to prepare for a potential recession in the country. In the recent budget statement, Chancellor Philip Hammond announced an additional £500 million for Brexit preparations and £1.5 billion for the high street. Additionally, the government will also increase the personal tax allowance and introduce measures to support small businesses.
However, not everyone is convinced that the government’s efforts are sufficient. Some economists are calling for increased investment in public infrastructure to create jobs and stimulate economic growth. Others suggest that tax cuts, particularly for small and medium-sized businesses, could provide much-needed relief during a period of economic uncertainty.
While the UK economy has been resilient in the face of challenges over the last decade, there are concerns that the uncertainty surrounding Brexit, coupled with rising interest rates, could lead to a recession. The government’s preparations for a potential economic downturn are commendable, but further measures may be needed to support individuals and businesses during a difficult period. Only time will tell if the UK will be able to weather the storm of a potential recession.
Thanks Sushi Runak
With inflation running at a four-decade high, the Recession is now the ‘most likely outcome for the economy and I cannot imagine being a victim of circumstances. My portfolio suffered a big hit, holding it further won’t be any good. I've heard of people netting hundreds of thousands this red season. How can I ensure this?
Greedy food companies are driving up inflation with high prices … greedy b.stards
Seemingly have one tool..raising interest rates! 30÷ are morgage free so the rest of us have to carry this burden!
This so called PM individual is the worst political leader the UK has ever had in it's history!
Tories were bragging about the state pension rise. Inflation has wiped the rise out
end of year in uk base rate will be 5%. it'll stay there for 3-4 years. they know but daren't say. inflation isn't easily controllable and each time historically it's hit 12.5 – 18 % it's taken a recession to get it under control. Charlie Munger has seen this before over his life as an economist. he says an interest rate hike is needed to cause recession to get inflation down.
Government borrowing…..why does the government need to borrow, theyre the government, they should be in charge of the money supply.
"We're going to grow the economy"
Literally going the other way…
They've failed as a government and a party imo
Bet rushi the pakitakii ain’t going suffer his currey wife probs got type 6 diabetes
Just because you have a mortgage, doesn’t mean you own your home. Tell them how it is, stop lying to average consumers, man.
The thing to me is, if you invest and have other income outside of dividends then you will be able to live off dividends without selling. Which means you can pass that on to your kids which will give them a leg up in life. $52k dividends received in 2022.
Recessions are part of the economic cycle, all you can do is make sure you're prepared and plan accordingly. I graduated into a recession (2009). My 1st job after college was aerial acrobat on cruise ships. Today I'm a VP at a global company, own 3 rental properties, invest in stocks and biz, built my own business, and have my net worth increase by $500k in the last 4 years.
I have a lot of respect for Jermey Hunt in this role. No dancing around hard questions and laying out the facts.
here we go again with their planned inflation and recession
Consequences of listening to the US
Idiots helped to start the war with russia..now we all paying for it so the nazi in Ukraine can gloat about killing russians and our stupid politicians can smile
British people allowing their pm, govt & politicians to waste billions on ukraine. British PM wasting money not stop conflicts that caused all these problems to world & also to British people livelihood. All those meetings in g7 are just useless since just want to keep the war in ukraine going & now also making hostilities with China too. The PM can help ukraine very fast response like even training their military personnels, wasting all those precious money & time on conflicts that "hit back" at Britain.
Keep it going & soon Britain bankings will follow US too.
The stupidity of politicians and policy makers is just unbelievable. The current high inflation is not demand driven, rather, it is from the supply side. They focus so much on their one blunt tool which is the interest rate, abuse it, just so that they can bring down the inflation, potentially at the cost of way more and wider damage to the economy and society, just so that they can tick the box to show "they are doing their job".
The economic crisis and downturn are all the signs of 2008 market crash 2.0, so my question is do I still save in the US dollar or is it okay to move all emergency and savings to precious metals?
they've managed to bring the borrowing cost to the pre-2008 level. That was the reason behind creating this artificial inflation
Are we the only country with rising food prices properly not.
Expect EU countries are in same boat blaming brexit is not the answer. There are world wide problems the covid outbreak &
War in Ukraine not helping.
Uk needs more inflation to grow their GDP
This country is a mess and it's because of the Tories. They feed lies just to funnel money up to the top to give businesses the power. What has actually changed from Brexit that benefits this country? All this talk of controlling immigration and control over our laws is utter bs. A pipe dream fed on a platter of lies.
UCL rish
Buy gold and silver and don't play their stock&shares game
I'm bored of the promises lies they no they work for us right
4 x times more expensive GAS from yours friends USA …. WAIT winter
India has 8% growth in economy because we don't sanctions other country and our politician think about its people interest.