Donald Trumps Iran War Threats Could Hit UK Economy Hard

Donald Trump’s decision to go to war with Iran will damage the UK’s economy more than any other major country, experts have warned.

The International Monetary Fund (IMF) said Britain’s gross domestic product (GDP) will grow by just 0.8% in 2026, 0.5% down on their last forecast in January.

That is the biggest downgrade of all the G7 nations, which includes the likes of America, France, Italy and Canada.

By contrast, the IMF said Canada’s GDP is expected to grow by 2.5% this year, a downgrade of just 0.1%.

The war, which began on February 28 when the US and Israel launched missile strikes on Iran, has led to the closure of the vital Strait of Hormuz waterway, sending the price of a barrel of oil soaring.

That has sparked fears of a global recession caused by high inflation and weak economic growth.

Responding to the IMF report, chancellor Rachel Reeves said: “The war in Iran is not our war, but it will come at a cost to the UK. These are not costs I wanted, but they are costs we will have to respond to.

“I have vowed that my economic approach to this crisis will be both responsive to a changing world and responsible in the national interest, keeping inflation and interest rates in check to protect households and businesses.

“We entered this conflict in a stronger position because of the choices this government took to build economic stability, but there is more to do.”

In an interview with the Mirror, Reeves said: “I feel very frustrated and angry that the US went into this war without a clear exit plan, without a clear idea of what they were trying to achieve.”

Liberal Democrat Treasury spokesperson Daisy Cooper said the UK’s economic downgrade is “a damning indictment of Trump’s idiotic war and all those who cheered it on – including Reform and the Conservatives”.

She said: “People in Britain are already feeling the pressure at the pump, and now it’s clear that we’re in line for a huge hit to growth and even higher prices on the shelves.

“Starmer’s latest flurry of stern words directed at the US President are worthless if there is no plan to protect people from Trump’s economic vandalism.”

But Tory shadow chancellor Sir Mel Stride said Reeves’ handling of the economy was to blame for the IMF downgrade.

He said: “Being handed the biggest downgrade in the G7 is a clear verdict on Rachel Reeves’ choices – and she’s got no one to blame but herself.

“Her ‘plan’ to keep costs down has left us with the highest inflation in the G7, with businesses closing and the cost of living skyrocketing.”

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