The U.K. economic contraction of 2023 will be almost as deep as that of Russia, economists expect, as a sharp fall in household living standards weighs on activity.
In its 2023 macro outlook, Goldman Sachs forecast a 1.2% contraction in the U.K. real GDP over the course of this year, well below all other G-10 (Group of Ten) major economies. This is set to be followed by a 0.9% expansion in 2024, the lender anticipates.
The figure places Britain only fractionally ahead of Russia, which the bank projects will see a 1.3% contraction in 2023 as it continues to wage war in Ukraine and weather punitive economic sanctions from Western powers. This will be followed by a 1.8% expansion in 2024, Goldman figures suggest.
The Wall Street giant forecasts U.S. expansions of 1% in 2023 and 1.6% in 2024. Germany — the next worst performer among major economies after Russia and the U.K. — is expected to see a 0.6% contraction this year, then expand by 1.4% next year.
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