Overview

• The FPC warns that President Trump’s April tariff hikes have raised the likelihood of corporate defaults in the most trade‐exposed sectors, which employ around 60% of UK workers.
• It states that the outlook for UK growth over the coming year is weaker and more uncertain due to escalating trade and geopolitical tensions.
• The report highlights the potential for energy price spikes if Middle East conflicts disrupt oil and gas supplies.
• It warns intensifying geopolitical strains could trigger cyberattacks and financial contagion from stresses in overseas banks.
• Despite elevated risks, the Bank concludes that UK households, businesses and banks have sufficient resilience and capacity to absorb significant economic shocks.