UK dey expected to fall into longest ever recession - Wetin e mean

Di Bank of England don warn say UK dey face dia longest recession since records begin, as dem raise interest rates by di most in 33 years.

Dem warn di UK say e go face “very challenging" two-year slump and unemployment go nearly double by 2025.

Bank Govnor Andrew Bailey warn say "tough road dey ahead" for UK households.

Dem don lift interest rates to 3% from 2.25, di biggest jump since 1989, as dem try to control rising prices.

E don make many households dey face hardship and e don also start to dey drag on di economy.

Wetin be recession and wetin e mean for UK pipo?

Recession na wen kontri economy shrink for two three-month periods - or quarters - in a row. Typically companies go make less money, pay fit fall and unemployment go rise.

Di Bank bin previously expect di UK to fall into recession at di end of dis year and e tok say e go last for di whole next year.

But di Bank now believe say di economy don already enta "challenging" downturn dis summer, wey go continue next year and fall into di first half of 2024 - a possible general election year.

While e no go be di UK deepest downturn, e go be di longest since record begin for di 1920s, di Bank tok.

Di unemployment rate currently dey at di lowest for 50 years, but e dey expected to rise to 6.5%.

Chancellor Jeremy Hunt say inflation dey "weigh heavily on families, pensioners and businesses" and di goment "number one priority na to "grip" am.

"Interest rates dey rise across di world as kontris dey manage rising prices wey Covid-19 pandemic and Putin invasion of Ukraine cause," e tok.

"Di most important tin di British goment fit do right now na to restore stability, sort out our public finances, and make di debt fall so dat dem fit keep interest rate wey dey high low."

For pipo wit glass wey dey half-full - dis dey lower dan di 6% assumed just a month ago for di post mini-budget market kasala.

While goment borrowing costs and di level of the pound don recover afta a series of U-turns since, mortgage markets and business loans still dey show some stress, and dis dey add to di prolonged hit to di economy.

Di forecast predict say di unemployment rate go rise to 6%, while household incomes go come down too.

Na picture of painful economic period, wit di UK performing worse dan di US and di Eurozone.

Indeed, wetin dem forecast as sharp energy recession just three months ago, no dey too deep again, but more prolonged energy and mortgage shock.

Di latest increase in rates take borrowing costs to dia highest in14 years, wen di UK banking system face collapse. Di move dey come as di cost of living dey rise at di fastest rate in 40 years.

Di Bank believe say by raising rates, e go make am more expensive to borrow and encourage pipo not to spend moni, and dis go ease di pressure on prices in di process.

But while di latest increase in rate go dey welcomed by savers, e go get knock-on effect on pipo wit mortgages, credit card debt and bank loans.

Di Bank forecast say if interest rates continue to rise, pipo wey dia mortgage deals dey come to an end fit see dia annual payments go up by £3,000.