UK economy set for prolonged stagnation and 'widening' inequalities

Stocks at “record cheap” levels

The UK's economic recovery from the pandemic looks set to falter as a combination of rising prices, low wages and the withdrawal of Universal Credit pave the way to a “massive” rise in destitution and inequality, a major thinktank has warned.

According to the latest quarterly outlook by the National Institute of Economic and Social Research (NIESR), the next few months are likely to bring "stuttering growth, rising inflation and widening income inequalities" to the UK economy. The damning report said household incomes will be "painfully" squeezed by a combination of earnings growth lagging inflation, rising interest rates and tighter fiscal policy. As it downgraded growth forecasts for the coming year, the organisation highlighted that regional inequalities are likely to become more pronounced. BoE defies market expecta...