The British Chambers of Commerce (BCC) expects the UK’s economic growth to halve this year amid soaring inflation, major tax rises and Russia’s invasion of Ukraine.
The BCC has downgraded its expectation for UK GDP growth in 2022 from 4.2% to 3.6% – less than half the growth of 7.5% recorded in 2021.
The downgrade largely reflects a deteriorating outlook for consumer spending and a weaker than expected rebound in business investment.
Consumer spending is forecast to grow at 4.4% in 2022, down from its previous forecast of 6.9%, while inflation is expected to outpace wage growth.
Hannah Essex, co-executive director of the British Chambers of Commerce, said:
“Our downgraded projections for the UK economy highlight the critical challenges facing business communities and households against the backdrop of the growing uncertainty surrounding both the UK and global economy.
“Coming hot on the heels of two years of a pandemic-induced squeeze on cashflow and investment plans, it is clear the Government must do more to support UK business and the wider economy.”
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