On Thursday, forecasts from PwC suggested that inflation in 2024 is set to decrease faster than the Bank of England (BoE) predicted, and the Big Four firms (Deloitte, Ernst and Young, KPMG and PwC) believe the original 2% target set by the BoE is achievable. Experts at the BoE suggested that inflation will not drop below 3% until Q1 of 2025 due to the dampening of wage growth and job outlook.
PwC backs UK economy and predicts a healthy 2024
According to recent data, the BoE’s targets are a little pessimistic when compared to their predictions, especially considering inflation fell to its lowest in two years at 3.9% in November 2023. PwC has warned the BoE that “increased inflationary pressures” will persist in either outcome but that a decrease in global energy prices could help soothe the difficulties faced by domestic households.
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Barrett Kupelian Source: LinkedIn
Barrett Kupelian, chief economist at PwC, expressed enthusiasm regarding the positive economy 2024 could bring. He stated:
Despite the legacy of high consumer prices and rising housing costs, inflation is returning to near-normal levels, progress on regional growth and improving real incomes provide optimism for the year ahead.
PwC also noted:
For the first time since 2021, more households would expect to be better off than worse off in twelve months’ time.
Last week, revised third-quarter data showed that Britain is on the brink of a technical recession following two consecutive quarters of negative growth. However, positive sentiment from the PwC suggests that the UK will outperform Germany and France in 2024, mainly due to increased consumer spending.
