UK Government faces pressure to revive economy amid job cuts, price hikes

(MENAFN) The UK government faces increasing pressure to revive the economy as businesses prepare for job cuts and rising prices, while millions of households expect their financial situations to worsen in the coming months. The Confederation of British Industry (CBI), ahead of a major economic speech by Chancellor Rachel Reeves, has warned that private sector firms are struggling to adjust their budgets in light of the measures introduced in last October’s budget.

The CBI, one of the UK’s most influential business lobby groups, has predicted another significant decline in business activity over the next three months, which would extend a period of economic stagnation that has persisted since mid-2022. Alpesh Paleja, the CBI’s interim deputy chief economist, noted that despite the passage of time, the new year has failed to bring any sense of renewal, with businesses still bracing for a major drop in activity.

Paleja emphasized the urgent need to revive momentum in the economy, urging the government to refocus its efforts on policies that could stimulate growth. He argued that the government has the power to shift the UK’s economic narrative by prioritizing measures that will drive business confidence and economic recovery.

Labour, which has been in power for less than a year, faces increasing pressure to fulfill its promises of economic stability and growth. Reeves is expected to use her upcoming speech to reassure the public and business community of Labour’s commitment to addressing economic stagnation and rebuilding confidence in the UK economy.

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