## United Kingdom: Selected Issues

_IMF Staff Country Reports, July 11, 2023_

## Source details

**Canonical URL:** [United Kingdom: Selected Issues](https://www.imf.org/en/publications/cr/issues/2023/07/10/united-kingdom-selected-issues-535881)

## Other formats

- [Markdown version](/en/publications/cr/issues/2023/07/10/united-kingdom-selected-issues-535881/index.md)
- [Structured JSON version](/en/publications/cr/issues/2023/07/10/united-kingdom-selected-issues-535881/index.json)
- [Bundle manifest](/en/publications/cr/issues/2023/07/10/united-kingdom-selected-issues-535881/bundle-manifest.json)

## Bibliographic details
- Published: July 11, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400248658.002

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### Energy price shock — impact and assessment
- Analyzes the impact of the energy price shock on UK households and firms.
- Describes the energy support measures introduced by the UK government and provides IMF staff’s assessment of these measures.
- Retail energy prices in the UK have seen greater pass-through from wholesale prices than in regional peers.

### Policy options and structural recommendations
- Proposes structural measures to ensure energy security and raise resilience to spikes in energy prices.
- Recommends refining support measures, especially improving the targeting of support that could be introduced in response to a possible resurgence in energy prices.
- Advises that broader business support should be targeted at viable but financially vulnerable firms and should focus on:
  - limiting scarring, and
  - facilitating the adjustment to higher energy prices.

### Liquidity and moral hazard considerations
- Notes that liquidity support may be appropriate to enable energy providers to meet their margin calls while continuing energy purchases on wholesale markets.
- Stresses that support should be structured to prevent moral hazard by management and investors.

### Key takeaways
- Focus on targeted, time-bound support for households and firms to shield vulnerable groups and viable businesses from temporary shocks.
- Strengthen energy security and resilience to reduce future exposure to wholesale price spikes.
- Consider liquidity mechanisms for energy providers alongside safeguards to avoid creating perverse incentives.

*United Kingdom: Selected Issues — IMF Staff Country Reports (July 11, 2023).*

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## Content in this bundle

- **United Kingdom: Selected Issues; IMF Country Report No. 23/253; June 20, 2023**
  - [United Kingdom: Selected Issues; IMF Country Report No. 23/253; June 20, 2023 (Markdown version)](/-/media/files/publications/cr/2023/english/1gbrea2023002.pdf.md){rel="alternate" type="text/markdown"}
  - [United Kingdom: Selected Issues; IMF Country Report No. 23/253; June 20, 2023 (PDF)](/-/media/files/publications/cr/2023/english/1gbrea2023002.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2023/07/10/united-kingdom-selected-issues-535881_