{
  "id": 14095694,
  "title": "UK economy to suffer second-highest inflation in G7",
  "url": "https://urgent.news/2026/10/13/uk-economy-to-suffer-second-highest-inflation-in-g7",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-13T02:00:00.000Z",
  "source": {
    "name": "City AM",
    "slug": "city-am",
    "url": "https://www.cityam.com/uk-economy-to-suffer-second-highest-inflation-in-g7/"
  },
  "original_language": "en",
  "account": "The International Monetary Fund has forecast that the UK's economy will experience the second-highest inflation among G7 nations over the next two years, potentially jeopardizing Chancellor John Healey's cost-of-living alleviation efforts. Inflation remains above the Bank of England's 2% target for the seventh consecutive year, averaging 3.3% in 2026 and 2.8% in 2027, surpassing most major economies. Only the United States will face a higher inflation rate this year, while Germany will lead in 2027. UK inflation has been higher than all G7 members since 2025, intensifying policymakers' struggle to maintain price stability. Interest rates are expected to remain elevated for an extended period. However, the IMF predicts that the UK will have a higher GDP growth rate than several European counterparts, with a projected 1.3% growth in 2026 and 1.2% in 2027, both above the US. Germany's GDP growth is also anticipated to be 1.3% this year. Despite being higher than most countries, the UK's per capita GDP will still be lower than that of Italy, Canada, and the US. The IMF's report highlights that AI and related infrastructure are driving global demand, while conflicts in Europe and the Middle East have impacted oil and gas supplies. While the global economy has weathered recent shocks, there are limits to resilience as AI investment could lead to higher prices, and governments face limited room for maneuver due to high debt levels. The IMF's forecasts assume the resumption of trade through the Strait of Hormuz in March 2027 and moderating technological changes next year. Growth is expected to slow next year due to high energy prices and interest rates, with the UK's monetary policy tightening more than other major economies. Economists advise Healey and his peers to utilize any growth-related revenue and lower energy prices to reduce borrowing, urging them to use extra government spending sparingly to support households or businesses without complicating monetary policy.",
  "summary": "The UK economy will suffer the second highest inflation of any G7 country over the next two years, the International Monetary Fund has warned, putting Chancellor John Healey’s efforts to ease the cost of living at risk. In its latest report published today, the global finance body has said that inflation will remain above the [...]",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}