Recession relief... but is borrowing about to spiral?

Some much-needed optimism to start the week as the EY Item Club, which uses the Treasury's model for its forecasts and commentary, joins a growing consensus that Britain's economy should avoid recession

- JAMES MOORE

It also thinks the nation’s well-capitalised lenders can support this better-than-expected outcome, despite ructions in the international financial system that have forced several bank rescues, including the hurried takeover of the systemically significant Credit Suisse by larger rival, UBS.

A combination of (soon to be) falling inflation (we hope), lower-than-expected energy bills (seems nailed-on) and a resilient (for now) jobs market means Item expects UK GDP to grow by 0.2 per cent in 2023, rather than contracting as previously forecast.

It’s not much to write home about, but given we once feared the longest recession on record, even if a relatively “shallow” one, it looks like party time.

Total loans to households and businesses, meanwhile, are expected to rise 1.2 per cent this year (a net increase of £29bn), improving on February’s forecast which called for a 0.1 per cent fall.