The UK is likely to continue to feel economic pain in 2023. A looming recession, raging consumer prices, cold winter, and hot summer, along with a deficit of Russian energy resources, are among the main factors contributing to an economic downturn in the country. In his New Year message, UK Prime Minister Rishi Sunak warned that the UK's problems would not "go away" in 2023. Sunak stressed that the government would "help the most vulnerable with the rising cost of energy bills" and the "government will always reflect the people’s priorities." Economists alert that the UK is heading for the deepest recession among the G7 in 2023. Against the backdrop of the pandemic and a conflict in Ukraine, an inflationary shockwave is likely to last longer and bring acute pains to the country’s economy. In this connection, the Bank of England is forced to keep the key rate at a high level and maintain a more contractionary fiscal policy.
