Economists forecast downturn to last until end of next year in UK as Britain is bent on making an unwanted record.
Accountancy firm KPMG said the country dropped into recession, defined as two consecutive quarters of decline, in the third quarter of the year.
And forecasters have further speculated the downturn to last until the end of next year, knocking 1.9 per cent off the UK’s economic output.
As it is, the UK is suffering the biggest drop in living standards on record as the surging cost of living eats into wages.
Soaring interest rates in the wake of Liz Truss and Kwasi Kwarteng’s disastrous mini-Budget also ‘added a headwind’ to growth, KPMG revealed in its economic outlook report.
Chief economist, Yael Selfin has predicted that families, particularly those on lower incomes, will rein in spending in the New Year, and eat out less often.
And KPMG added that by the middle of 2024 spending in the UK per person will have fallen by 3.4 per cent.
Though the picture could turn more positive, particularly if energy bills return to more normal levels, as speculated by Selfin.
KPMG’s report also showed unemployment in the UK will remain relatively low, providing ‘an important support to incomes’.