12 Apr 2023The International Monetary Fund (IMF) has predicted that UK interest rates could fall to their pre-COVID levels in the near future. The IMF said that interest rates have risen rapidly recently as monetary policy tightened in response to higher inflation. However, its analysis also suggested that these rises are likely to be temporary, and when inflation is brought back under control banks are likely to ease monetary policy, helping to bring interest rates back to pre-pandemic levels. Additionally, the IMF has also warned that the UK economy is set to be one of the worst performing economies in the world this year. It predicts that the economy will shrink by 0.3% this year, and pointed to the UK's high energy prices, slow trade performance and rising interest rates as contributing factors. The analysis shows that global growth is expected to fall from 3.4% in 2022 to 2.8% in 2023, rising to 3% in five years' time.