The UK Chancellor Jeremy Hunt made a number of claims on Wednesday regarding the UK economy and how it compares to other countries. In an interview on BBC Radio 4, Hunt compared the UK’s inflation rate to that of Europe and the US, stating that although UK inflation was now lower than in these regions, prices were still considerably higher than they were a year ago. Hunt was correct in his statements, with inflation measured by the Consumer Prices Index at 2.3% in the UK, compared to 3.4% in the US and 2.4% in the eurozone during April 2024. While this is accurate, the UK’s inflation rate reached a higher peak than both the US and eurozone, at 11.1% in October 2022.
Hunt also claimed that the UK economy would grow more over the next six years than that of France, Germany, Italy or Japan, according to the International Monetary Fund (IMF). The IMF predicts that the UK economy, measured by gross domestic product (GDP), will be 8.8% larger by the end of 2029 than it was at the start of 2024. However, this growth is smaller than that predicted for the US and Canada – with 13.7% and 10.8% growth respectively – and it is worth noting less optimistic short-term growth forecasts by other organisations such as the Organisation for Economic Cooperation and Development (OECD).
Addressing UK living standards, Hunt stated that living standards had fallen in Sweden, Austria and Germany more than in the UK. Hunt did not specify the period or measure of living standards he was referring to, but it was later confirmed he was talking about the OECD’s measure of “gross disposable household income” for a specific period – from April to June 2022, compared to October to December 2024. While the OECD data supports this, it is worth noting that UK living standards performed worse than G7 country averages from the final three months of 2019 to the end of 2024.
Finally, Hunt claimed that foreign direct investment (FDI) in the UK in recent years had been second only to that of China and the US. While this FDI data does show that foreign investment in the UK increased significantly from 2010 to 2022, it was lower than the US and China, but higher than Germany and France. Other studies also indicate that the UK is lagging behind France in terms of attractiveness to foreign investors
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