IMF warns of price rise worsening

The International Monetary Fund (IMF) has reiterated its criticism of the chancellor’s mini-budget after warning it will fuel the already rising prices. The body working to stabilize economic growth has admitted that tax cuts announced by Kwasi Kwarteng would boost growth in the short term.

However, it also added that cuts would complicate dealing with soaring prices. It expects high prices to continue longer in the UK, with only Slovakia out of the eurozone set to witness higher inflation.

Inflation measures how the cost of living changes with time, and it is expected to peak at about 11.3% before the year-end in the UK, according to the recent assessment of the global economy by the IMF.

In the next two years, it is expecting a rise in prices of about 9% each year— far above the Bank of England’s target of 2%.

Even though the UK economy is set to grow the fastest among the world’s major economies included in the G7 group this year, it is estimated to grind to a near-halt next year, expanding by just 0.3%.

However, the latest figures in the report by the influential financial institution do not take into account the UK chancellor’s recent mini-budget entirely.