Boris Johnson insists Britain will dodge recession amid soaring inflation and cost-of-living crisis 

Despite inflation reaching a four-decade high, Johnson says 'there are ways forward for the UK that are incredibly exciting'

Boris Johnson, the British prime minister: As inflation hits 9%, the Bank of England is expecting a sharp contraction in growth later this year and a prolonged stagnation afterwards.

Boris Johnson, the British prime minister, said the UK could a dodge a recession in the months ahead even as the cost-of-living crisis sets the stage for a “difficult” period.

Economic pressures are emerging as the gravest political threat to Mr Johnson and his party, beyond the various scandals that have dogged his government such as the row over illegal parties in Downing Street during the pandemic.

Inflation is at a four-decade high of 9% and is predicted to go even higher, while the Bank of England is expecting a sharp contraction in growth later this year and a prolonged stagnation afterwards. 

British inflation is running faster than other parts of Europe and many economists predict that the rate could peak as high as 11%, partly because of Brexit

Inflation in Ireland, currently at 7%, is set to peak at 8% this summer, according to leading economists.    

However, Mr Johnson is more bullish on the outlook. Asked on Bloomberg TV whether the UK was headed for a recession, he said: “Not necessarily at all.”

“There are ways forward for the UK that are incredibly exciting,” he continued. “If we make sure that we have a proactive approach to talent from abroad — we want to control immigration but allow the talent that we need to come in — we fix our energy supply issues, we fix the issues in the UK labour market,” he said. 

One of the incredible things about the economy right now is that unemployment is at its lowest level since I was two years old

The comments come a day after Mr Johnson’s government bowed to intense pressure to do more to tackle the UK’s cost-of-living crisis, unveiling billions of pounds of supports for households. While the move was welcomed as a short-term fix, families are still facing soaring energy bills and prices in shops. Some lobby groups have called for a longer-term solution. 

Bloomberg — additional reporting Irish Examiner