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UK faces recession risk if Strait of Hormuz remains closed, EY warns
EY’s latest UK economic outlook warns that a prolonged closure of the Strait of Hormuz could push Britain into recession. If the waterway stays shut until early‑mid 2027, EY projects UK GDP growth of only 0.5 % in 2026 and a contraction of 0.2 % in 2027, with inflation climbing to about 6.4 % by the end of 2026. In a more optimistic base case, assuming the strait reopens by the end of the third quarter of 2026, EY upgrades its 2026 growth forecast to 0.9 % (up from 0.8 %) and expects 1.2 % growth in 2027. The firm also expects the Bank of England to keep interest rates at 3.75 % through 2026 and cut them to 3.25 % in 2027. The Strait of Hormuz carries roughly one‑fifth of global oil and gas shipments, making its disruption a major risk to the UK’s energy‑linked inflation and overall economic resilience.
Entities
Bank of England · EY · EY (Ernst & Young) · Ernst & Young · Ernst & Young (EY) · Peter Arnold · Strait of Hormuz · United Kingdom
Claims
What the coverage asserts, and how many sources carry each claim.
- [● 18 SOURCES] EY revised its 2026 growth forecast from 0.8 % to 0.9 % and cut its 2026 business‑investment outlook to a 0.7 % decline. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 18 SOURCES] Household‑spending growth is projected at 0.3 % in 2026 and 0.9 % in 2027. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 18 SOURCES] Bank of England is expected to keep interest rates at 3.75 % in 2026 and cut them to 3.25 % in 2027. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 18 SOURCES] The Strait of Hormuz carries roughly one‑fifth of global oil and gas shipments. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 18 SOURCES] EY expects UK interest rates to stay at 3.75 % through 2026 and be cut to 3.25 % in 2027. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 18 SOURCES] If the Strait of Hormuz reopens by the end of Q3 2026, UK growth will be 0.9 % in 2026 and 1.2 % in 2027. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 18 SOURCES] Inflation could rise to 6.4 % by the end of 2026 under the adverse scenario. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 18 SOURCES] If the Strait of Hormuz remains shut until early to mid 2027, UK growth this year will slow to 0.5 % and the economy will shrink 0.2 % in 2027. www.standard.co.uk · mix929.com · www.businesstimes.com.sg · www.easterneye.biz · wdez.com · +12 more
- [● 2 SOURCES] If the Strait of Hormuz reopens by Q3 2026, EY projects UK growth of 0.9 % in 2026 and 1.2 % in 2027. www.standard.co.uk · mix929.com