Britons warned of damaging impact of rising inflation
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Prior to the 2016 European Union (EU) referendum, Remainers argued that Britain would struggle financially from a divorce with the bloc. The Government had to negotiate trade deals with nations around the world. Since breaking away, it’s also had to contend with the Covid pandemic and ongoing war in Ukraine. Express.co.uk analyses how both the UK and EU rank against each other for a number of key metrics.
The most recent figures for Britain show that its Gross Domestic Product (GDP) is estimated to have fallen by 0.1 percent in March.
Compared with its pre-coronavirus level in February 2020, monthly GDP is now 1.2 percent higher.
Growth has slowed sharply ever since last January, when GDP jumped by 0.8 percent, as people returned to normal life, following a surge in Omicron cases last December.
Last year, GDP in Britain grew by 7.5 percent, representing the fastest annual growth rate since World War 2.
But the International Monetary Fund (IMF) forecast much slower growth for 2022 – 3.7 percent.
In 2023, British GDP is expected to swell by 1.2 percent, which would be the lowest projected annual growth rate in the G7.
On the other hand, the EU is predicted to enjoy even slower growth of 2.7 percent this year, and 2.3 percent in 2023.
The predictions were the first to be made by the bloc, after Russia’s invasion of Ukraine began last February.
Inflation is the rate at which prices are rising. For example, if a pint of milk cost £1 and inflation grows by nine percent, then it’s now worth £1.09.
Both the UK and EU are facing up to unprecedented levels of inflation, but it’s Britain that’s feeling the greater pinch.
The measure is currently ranked at nine percent across the British Isles – the highest value for 40 years – while inflation in the Eurozone now stands at 8.1 percent.
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Before the year is out, the Bank of England (BoE) has warned that inflation could reach 10 percent in the UK.
Rising fuel prices and energy bills are the main causes of rising inflation for both powers.
Issues are being further exacerbated by the Russian invasion of Ukraine, which has led to a number of countries cutting ties with Moscow’s energy supplies.
To help reduce inflation in Britain, the BoE has grown interest rates by 0.25 percentage points, to one percent, which matches the level previously set in February 2009.
In the three months to March 2022, the employment rate in the UK was 75.7 percent, compared with 74.7 percent for the same period in 2021.
After almost dropping below 70 percent in 2011, the employment rate in the UK started to climb at a relatively fast pace, peaking in early 2020.
But following that point the employment rate has declined to the levels seen in more recent months, due to the arrival of the Covid pandemic.
The latest figures for the EU show that in 2021, the share of employed people in the bloc was 73.1 percent.
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