Here we are again. Today the International Monetary Fund (IMF) published its World Economic Outlook, which now predicts the UK will grow at just 0.6% next year, a downgrade from 1% in their previous forecast. This would be the lowest in the G7.

As ever with the IMF, however, their soothsaying needs to be taken with an enormous pinch of salt. Not only are they notoriously pessimistic in their forecasts – see the chart below – they admit the latest outlook doesn’t even account for the upward revisions to the UK economy after the pandemic. Something you’d think would be relevant given how wrong the Office for National Statistics were… 

In April, the IMF predicted the UK would fall into a recession this year. That turned out to be wrong. They also claim in this latest forecast that they expect “the Bank of England to raise [interest rates] to peak at about 6%“, despite the BofE holding rates at 5.25% at the end of last month, and the markets now believing the peak has already been reached. According to Sky News, the IMF’s data today is based on figures from August. The difference between 5.25% and 6% is enormous, in case anyone at the IMF needs reminding…