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IMF Predicts UK Inflation at 2% by 2026 Amid Growth

1/20/2026

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Story summary
  • The International Monetary Fund (IMF) forecasts UK inflation will hit 2% by the end of 2026, driven by a weak jobs market and slower wage growth.
  • The UK is set to be the fastest-growing G7 economy this year, yet it lags the United States and Canada.
  • The Bank of England will keep rates at 3.75% in February, with cuts possible later.
  • Geopolitical tensions, especially U.S. tariffs, may create inflation-forecast uncertainty.