Goldman Sachs Exchanges Is the UK economy finally turning the corner?
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May 7, 2024 
Goldman Sachs Research expert Jari Stehn discusses the UK economy's challenges, potential for growth, and the role of small businesses. Topics include energy crisis impact, monetary policy effects, small business optimism, AI opportunities, and political focus on small businesses driving growth.
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UK Economy Turning the Corner
- The UK economy, stagnant since mid-2022 with a mild recession, is showing signs of recovery.
- Factors include the energy crisis, rising inflation, and monetary policy tightening.
UK Inflation vs. US Inflation
- UK inflation has fallen from 11% to 3%, but underlying measures remain high due to wage growth.
- Despite recent upticks, the disinflation process is on track, unlike the US.
BOE Rate Cuts
- Markets predict the Bank of England (BOE) will cut rates before the Federal Reserve, a historically unusual move.
- This is justifiable due to the UK's weaker economic conditions and ongoing disinflation.