The UK is on the verge of a major economic disaster

This may include adverts from us and 3 rd parties based on our understanding. Last week the Bank of England Governor Andrew Bailey hinted at the notion of an increase in interest rates for the first time since the COVID - 19 pandemic set in. Figures prior to the news seemed promising, with the UK proudly boasting of the strongest growth across G 7 nations as the pandemic slowly began to ease and trade returned to some form of normality.

However, the caveat to this fact is that the UK also suffered from one of the worst slumps in its economy across the G7 nations, meaning that the exponential growth was only proportional to its huge losses. Speaking of the rise last week, Mr Bailey said: Monetary policy cannot solve supply-side problems but it will have to act and must do if we see a risk, particularly to medium-term inflation expectations and to medium-term inflation expectations. Using this as a platform to make the decision, he went on to say: And that s why we at the Bank of England have signalled, and this is another such signal, that we will have to act. But of course action comes in our monetary policy meetings. The Bank of England has predicted that Britain s inflation rate will rise over 4 percent, which is double its target. Part of the reason is the recovery period from the COVID - 19 pandemic. With China heavily dependent on imports of consumer goods, Britain has seized this demand and is using the notion of Mercantilism to maximise its exports across the world, thus boosting its economy at the expense of others. For the UK, interest rates are predicted to rise from 0.1 percent to 0.25 percent. Although this may sound insignificant, it appears that this rise may well be just the eye of the storm, as pre-pandemic rates were at 0.75 percent and could easily surpass this following the trends of other Western European nations. However, this could come too late by the central bank as too little too late. The problem for the UK, and the rest of the European nations in a similar situation is excessive debt. Currently, the British debt stands at 85.4 percent of the GDP, which is significantly higher than Germany's 98.1 percent, but less than France's 59.8 percent. Spain issues final ultimatum over decolonisation of Gibraltar - Br. Russia issues warning to NATO REVEAL Macon labelled a FROG by former President OPINION Add to this the borrowing by the UK Government during the pandemic, which according to figures was 299 bn in 2020 to 2021 plus another expected 200 bn this year, and the nation's economy could be on the verge of a major event. Similar to the economic model of Japan, the sheer weight of debt can become a permanent anchor on growth, thus seeing a rise in inflation and interest in the process. Should the situation become worse, the UK could enter a period of deflation, meaning that general price levels in the country fall, and with the economy now dominated by debt, fueled by asset price bubbles, can lead to a temporary financial crisis and a period of liquidation of speculative interest.