The possibility of even bigger increases in the Ofgem utility price cap early next year means that the economy is facing down the barrel of a fairly deep recession. The depth of the recession ultimately depends on the response of the government. We think it needs to step up and demonstrate that it is willing to absorb a lot of the hit to real national income generated by higher wholesale gas prices and to protect those in need. We’re expecting a £30bn support package, but even that may not prevent a deeper recession than we currently expect.
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