Keir Starmer will collect his cabinet today after the Bank of England has given an alarming assessment of the 'stagflation' threat of the UK.
The prime minister holds a special meeting of ministers in Westminster to 'take the balance' after new predictions underline the ever -grimmer state of the economy.
Yesterday in a dramatic announcement, the Bank halved the growth reasons for this year from 1.5 percent to 0.75 percent.
It also warned that it was pointed out that inflation has decreased slower than hoped, and it is expected that 'equipment' will increase to 3.7 percent in the first half of this year – with the fault of the enormous budget tax attack by Rachel Reeves and as well as rising Energy and water costs.
Experts believe that the sharp delay and higher loan costs have left the Chancellor with a large gap in the books of the government, which must be filled with extra tax increases or cuts. The OBR wake dog of the treasury is in October in a much higher growth figure of 2 percent in October.
Every attempt to cut the expenses will, however, be investigated with strong resistance of Labor MPs who would regard it as 'austerity'.
Keir Starmer is holding a special meeting of ministers in Westminster to 'take stock' after new predictions underline the ever -grimmer state of the economy
The updated predictions of the bank suggest that inflation will be relaxed slower than hoped, and the growth is 'weaker than expected'
The Bank's Monetary Policy Committee offered some respite for British because it reduced interest rates from 4.75 percent to 4.5 percent in an attempt to breathe new life into the growth.
Two of the nine members voted for a greater reduction in the rates by 0.5 percentage point, in a surprise that the nerves in the financial markets were Yangling.
The need to start the activity weighed heavier than the fear that Donald Trump's trade rates will exert further upward pressure on prices – something that Threadneedle Street Rentet rates uses to prevent.
Without criticizing the Chancellor directly, the bank said that growth was weaker than expected … and that the indicators of business and consumer confidence had decreased '.
Economists warned that the UK seemed to be on their way to 'stagflation', when the economy flatlines, even when the inflation pressure comes in the course of the place.
The problem destroyed Groot -Britain in the 1970s on a much larger scale, when inflation was 20 percent while the economy is shrinking.
The pound fell sharply against the US dollar yesterday when the markets were priced in four interest rates this year.
Sir Keir and Mrs. Reeves put a brave face on the news, while they are scrambling to find policy that can stimulate growth.
The prime minister said that people would have more money in their pockets. ”
But Tories condemned government policy to destroy confidence, forcing the company to lower jobs and increase prices. Some analysts even warned that there is a chance of recession.
Experts believe that the sharp delay and higher loan costs have left the Chancellor (photo) with a large gap in the books of the government
Inflation will be 3.7 percent this summer before he participates again
Kemi Badenoch said that the BOE report showed that Labor 'had ruined the economy'
Kemi Badenoch said that Labor 'had ruined the economy' and the situation was 'worrying'.
Shadow Business Secretary Andrew Griffith said: 'Today's predictions of the Bank of England are a wild indictment of the 100 days since the disastrous budget of Labor.
“Our main streets and companies are bleeding because of Labor's choices, but Rachel does not want to know or not listen.”
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “The risks of stagflation are grim. Inflation remains above the target of 2 percent of the bank and the price pressure is accumulating, but the economy is stagnating and the business trust has been beating. '
