Britain’s Economy Takes a Rough Slide – And Trump’s Tariffs Are the Sidecar
It’s not a casual drag, folks. The latest numbers are spelling out a grim version of “The Great British Economic Dread” as growth forecasts for 2025 and 2026 have been trimmed to thin slices of optimism. Lucky for Chancellor Rachel Reeves, the mood remains as groggy as a post‑holiday flat.
GDP Shrinks, Forecasts Guzzle, and Confidence Hits a Nadir
- EY’s 2025 growth cut: 1% → 0.8%
- EY’s 2026 growth trimmed: 1.6% → 0.9%
- 2027 still hopeful but uncertain: 1.5%
Meanwhile, the IMF opted for a slightly less dramatic dip—down to 1.1% for 2025 from 1.6% last month.
Got to Mention a Chunk of the Problem: U.S. Tariffs
Remember that 10% tariff on every import and a whopping 25% on cars? That’s not just a steal for Trump fans—it’s hurting the UK and the globe like a yoyo of economic doom. Global trade is wobbling, and that tremor is shaking investors and households alike.
Households Are Too Shy For New Homes
With running costs and inflation strutting around, even the brave are holding back on pricey home extensions. Companies are giving their invest‑ment budgets a big “nah.” The market feels like a circus with too many clowns and no daredevil prospects.
Anna Anthony Brings the Rain‑Check
“We saw the economy beating expectations in early 2025, but the chaos of trade, uncertainty, and inflation may have kept us in low‑grade growth territory.”
“Businesses thrive on certainty. Unpredictable global markets turn into low‑level business investment.”
“But services are still moving forward. A gradual cut in interest rates should nudge business and household spending.”
“In the long run, an unpredictable global scene might let the UK re‑brand itself as a stable, attractive investment playground.”
Bottom Line
Income is cautious, buying is cautious, but the services sector still has a fighting chance. Keep your eyes sharp—these forecasts can flip, but the main lesson is that a calm market may still spark some lively opportunities.
