UK sees better than expected 6.5% growth this year

AFP News Agency

27th Oct, 2021. 08:16 pm
UK Economy

UK economic rebound slows sharply as supplies hit. Image: File

LONDON: Britain’s pandemic-hit economy is expected to rebound by 6.5 per cent this year before slowing slightly in 2022, Finance Minister Rishi Sunak announced on Wednesday in his budget statement.

The 2021 forecast was much stronger than the 4 per cent growth predicted in March but Sunak added that the pace would slow to 6 per cent next year.

Sunak said the UK economy was on course to return to its pre-pandemic level at the turn of the year, while recognising that “people are concerned about global inflation”, which is rising at a fast pace, as economies reopen after lockdowns.

Sunak said the UK’s annual inflation rate was forecast to climb to an average of 4 per cent over the next year from 3.1 per cent currently, with price rises fuelled by soaring energy costs and supply constraints.

Britain’s growth expectation this year; meanwhile, compares favourably with Europe’s biggest economy Germany, which on Wednesday forecast GDP expansion of around 2.6 per cent in 2021.

Germany’s slower-than-expected rebound from a pandemic-induced slump last year was largely owing to bottlenecks in the global supply chains, its government said.