The UK is set to enter a recession which will hit millions of the most vulnerable households, especially in the worst-off areas, a new economic report has warned. Gross domestic product is set to shrink in the third and fourth quarters of this year, and in the first three months of next year.
The report, from the National Institute of Economic and Social Research (NIESR), warned of a “three-quarter technical recession, but a relatively shallow one”. However it also said there is an “increased possibility of a deeper recession”.
It said the threat of stagflation, a nightmare of economists, has returned for the first time since the 1970s. Stagflation is where an economy sees slow growth, high unemployment and rising prices.
