A resilient world economy is being tested

The International Monetary Fund (IMF) and the World Bank kicked off their spring meetings in Washington this week, with finance ministers, central bankers, academics and private sector executives from across the globe attending. During the week, topics for discussion will centre around the global economy, international issues, financial stability, poverty reduction and the growth outlook.

Ahead of the meetings, addressing tensions in the Middle East, Kristina Georgieva, Managing Director of IMF said, “A resilient world economy is being tested again… The conflict has caused considerable hardship in the region and around the globe. Our focus will be on how best to weather this latest shock and ease the pain on economies and on people.”

On Tuesday, IMF released its latest global economic outlook, outlining growth of 3.1% this year, a reduction from the January forecast of 3.3%, followed by growth of 3.2% next year. This projection reflects that ‘global activity now faces a major test from the outbreak of war in the Middle East’ and assumes the ‘conflict remains limited in duration and scope.’ A modest rise in global headline inflation is expected. Developing economies and emerging markets are anticipated to experience more pronounced slowdowns in growth and upticks in inflation. For the UK, IMF reduced the 2026 growth estimate to 0.8%, down from 1.3% predicted in January.

Starmer visits the Middle East

The Prime Minister travelled to the Middle East last week to meet with regional leaders who have been on the front line of the war. During the visit, Starmer emphasised the UK’s support of a full ceasefire and held talks on the permanent reopening of the Strait of Hormuz. Starmer highlighted that Britain must become more resilient to global shocks such as these so that people are “not at the mercy of events abroad.” Writing in the Guardian, the PM said, “no longer do we live in the benign conditions found during the early part of this century.” He therefore committed to building “a Britain that is stronger, more secure and more resilient.”

Peace talks between Iran and the US at the weekend concluded without a deal. On Monday, Sir Keir confirmed that the UK would not play any part in enforcing the US military blockade of Iranian ports, saying the UK is focused on reopening the Strait of Hormuz.

The mood across the UK housing market has shifted

The latest Residential Market Survey from the Royal Institution of Chartered Surveyors (RICS) highlighted the impact of tensions in the Middle East on the UK housing market. Last month, sales activity weakened significantly as geopolitical uncertainty and rising borrowing costs knocked the confidence of buyers.

In March, new buyer enquiries decreased from a net balance of -29% to -39%, marking the weakest reading since August 2023. Agreed sales also fell to -34%, down from -13% the previous month. Many of the respondents expect activity to weaken further in the coming months, with short-term sales expectations decreasing significantly from -4% in February to -33% in March.

Survey responses suggest a downward pressure on house prices – the headline price balance decreased to -23% in March, down from -14% in February. Expectations for house prices in the coming three months also dropped to -43%, but the 12-month outlook is still slightly more optimistic at +2%.

Tarrant Parsons, Head of Market Research and Analysis at RICS, commented, “The mood across the UK housing market has shifted markedly over the past couple of months. What had been a cautiously improving picture for activity has been knocked off course by the wider macro fallout from the Middle East conflict.”

Share of private pension wealth

A report from the Institute for Fiscal Studies (IFS) has found that private pensions account for the largest share of wealth held by UK households. According to the data, pensions accounted for over half (54%) of total household wealth in 2020-2022. Interestingly, the share of household wealth held by people aged 20 to 39 increased over the 2010s, rising from 10% at the start of the decade to 18% at the end. Meanwhile, the share of wealth held by the top 10% gradually reduced from 45% in 2006-08 to 42% in 2020-22. The statistics also highlighted wealth inequality, with degree holders more likely to hold private pension wealth.

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All details are correct at time of writing (15 April 2026)