As the United Kingdom marks the third anniversary of its formal departure from the European Union, its overarching economic narrative is one of doom and gloom. But there are some promising early signs that the country could be moving toward the kind of regional rebalancing that it needs.
LONDON – As if conditions weren’t gloomy enough in the United Kingdom, the International Monetary Fund recently downgraded the country’s growth forecast even as it offered a brighter outlook for the rest of the world. This was an odd and rather audacious move. While the UK certainly faces challenges, it is not clear that they have become any more difficult since the IMF released its last forecast in October 2022. If anything, a stronger global economy should benefit the UK, too.
Discussions about the UK’s never-ending gloom tend to ignore two trends that may be suggestive of a pleasant surprise, despite the current political leadership’s haplessness. (I say “could” because much will depend on whether Britain can overcome the policy chaos that has prevailed since Brexit.)
The first trend involves UK house prices – which is both a favorite dinner-party topic for homeowners and a persistent source of frustration for all those not fortunate enough to have gotten a foot on the homeownership ladder. Alongside the lack of social mobility, this is one of the UK’s central economic challenges. But the issue is not just high prices relative to incomes. Equally important are the regional disparities in housing prices.
LONDON – As if conditions weren’t gloomy enough in the United Kingdom, the International Monetary Fund recently downgraded the country’s growth forecast even as it offered a brighter outlook for the rest of the world. This was an odd and rather audacious move. While the UK certainly faces challenges, it is not clear that they have become any more difficult since the IMF released its last forecast in October 2022. If anything, a stronger global economy should benefit the UK, too.
Discussions about the UK’s never-ending gloom tend to ignore two trends that may be suggestive of a pleasant surprise, despite the current political leadership’s haplessness. (I say “could” because much will depend on whether Britain can overcome the policy chaos that has prevailed since Brexit.)
The first trend involves UK house prices – which is both a favorite dinner-party topic for homeowners and a persistent source of frustration for all those not fortunate enough to have gotten a foot on the homeownership ladder. Alongside the lack of social mobility, this is one of the UK’s central economic challenges. But the issue is not just high prices relative to incomes. Equally important are the regional disparities in housing prices.