United Kingdom: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the United Kingdom
IMF Staff Country Reports, February 13, 2018
Source details
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- United Kingdom: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the United Kingdom
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Bibliographic details
- Published: February 13, 2018
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484341704.002
Executive summary and macroeconomic assessment
- Economic growth in the United Kingdom has moderated since the beginning of 2017, reflecting weakening domestic demand.
- The sharp depreciation of sterling following the referendum has raised consumer price inflation, squeezing household real income and consumption.
- Business investment has been constrained.
- In the medium term, growth is projected to remain at about 1.5 percent under the baseline assumption of continued progress in Brexit negotiations that lead to an understanding on a broad free trade agreement and on the transition process.
Risks and uncertainties
- The baseline outlook is subject to a number of risks, including:
- developments with Brexit negotiations;
- uncertainty about the recovery of productivity growth;
- the current account deficit.
Key findings and policy-relevant points
- Sterling depreciation after the referendum has had inflationary effects that reduce household real incomes and consumption.
- Business investment has been constrained in the post-referendum period.
- Medium-term projection: growth at about 1.5 percent contingent on favorable Brexit negotiation outcomes and transition arrangements.
Thematic tags and subjects
- Subject: Banking, Expenditure, Income, Inflation, National accounts, Prices, Production, Productivity, Public debt
- Keywords: BoE's website, CR, EU exit, EU exit negotiations, Global, government, IMF staff estimate, Income, Inflation, ISCR, Productivity, UK banking system, UK CCyB rate, UK's productivity challenge
Source: United Kingdom: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the United Kingdom (February 13, 2018).
Content in this bundle
- Country Report