Goldman predicts UK recession

Goldman Sachs expects the UK economy to enter recession from the fourth quarter of 2022 Goldman Sachs expects the UK economy to enter recession from the fourth quarter of this year. In a research note published today, Goldman Sachs economists stated that they expect UK GDP to contract by around 1.0 percent by mid-2023, while they revised their growth expectations for the full year 2023 from 1.1 percent to a 0.6 percent contraction. “Concerns about cost of living pressures in the UK continue to intensify, supported by the worsening energy crisis. A significant decline in real consumption remains likely,” the economists led by Sven Jari Stehn said in the research note. Goldman Sachs, which predicts that the household savings rate will fall below the "break-even rate" to a record 3.5 percent in the second quarter of 2023, predicted that real disposable income will fall by 2.9 percent and real consumption by 1.4 percent in 2023. Goldman Sachs, which expects the BoE to hike interest rates by 50 basis points in September, also emphasized that the risks to the expectations of 25 basis point rate hikes for November and December are on the upside.