UK Economic Growth Forecast Revised
The UK economy is now expected to grow at a slower pace this year than previously projected, according to the government's official forecaster. However, growth predictions for subsequent years have been upgraded.
The Office for Budget Responsibility (OBR), responsible for outlining economic performance based on government tax and spending policies, has reduced its growth forecast for 2026 to 1.1%, down from the 1.4% predicted in last November's Budget.
Chancellor Rachel Reeves presented these figures during her Spring Statement, noting that the OBR anticipates inflation to decrease more rapidly than earlier estimates suggested.
"The OBR expected inflation to slow at a faster pace than previously thought."
It is important to note that these forecasts were compiled before the recent escalation of conflict in the Middle East.
Following strikes launched by Israel and the US on Iran on Saturday morning, and subsequent retaliation by Tehran, oil and gas prices have surged significantly.
Despite this, Reeves indicated that economic growth projections for 2027 and 2028 have been revised upward to 1.6% for both years.
