UK Growth Forecast Slashed to 1 for Next Year Amid Iran War Impact
The watchdog also raised this year’s growth estimate to 1.2% and said inflation and higher borrowing costs will weigh on the outlook.
- The Office for Budget Responsibility cut Britain's economic growth forecast for next year to 1%, marking a significant reduction from its previous 1.6% projection.
- Chancellor John Healey warned that "global economic storms" linked to Iran prompted the sharp downgrade in growth projections, a shift from forecasts prepared before the Iran war.
- The OBR upgraded this year's growth to 1.2% while projecting recovery to 1.6% in 2028, followed by 1.8% in 2029 and 1.7% in 2030.
- Healey cited rising borrowing costs when reducing fiscal headroom to £15 billion in 2029/30, down from a previous £26 billion projection.
- The reduced headroom reflects a £14 billion jump in debt interest costs over the past year, though the watchdog expects headroom to recover to £22 billion by 2031.
17 Articles
17 Articles
Healey faces ‘£11bn hole’ as growth slashed and inflation to rise
Britain’s fiscal watchdog has predicted that growth will slump and joblessness and inflation will surge in the coming years, as they warned John Healey will have to find billions of pounds more revenue between 2029 and 2032 in order to prevent cuts to government spending. The Office for Budget Responsibility said the Chancellor would need [...]
Economic Growth Set To Slow Next Year Despite Burnham Pledges, Watchdog Warns
The UK growth forecast has fallen to 1% for next year, according to the country’s public finances watchdog.In a new report published on Wednesday along with the first Budget of Andy Burnham’s government, the Office for Budget Responsibility (OBR) predicted rising inflation would slow down anticipated economic growth.While UK gross domestic product (GDP) is expected to improve by 1.2% this year – up from an estimate of 1.1% – it will go down in 2…
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