The UK economy is expected to grow at a slower rate than previously expected from next year, the government’s official forecaster has said.The Office for Budget Responsibility (OBR), which maps out how the economy is set to perform based on the government’s tax and spending policies, increased its growth expectations for this year, but downgraded its forecast for the following four.It said lower productivity growth – a measure of output of the economy per hour worked – was behind the weaker growth forecast.The OBR’s forecast was published in error ahead of the Chancellor Rachel Reeves delivering her Budget on Wednesday.The OBR apologised for what it called a “technical error” and said an investigation was under way into how the error occurred. Reeves said the mistake was “deeply disappointing”.In its forecast, the OBR predicted the economy would grow by 1.5% this year, higher than its previous estimate of 1%.However, it said growth would be lower at 1.4% in 2026 and 1.5% in the following four years – all of which are downgrades from its forecast made in March.”We expect quarterly growth to pick up only gradually in the near term as geopolitical uncertainty persists and domestic business and consumer confidence remains subdued, including in anticipation of further tax rises,” the OBR said.Previously growth had been expected to hit 1.9% next year, 1.8% in 2027, 1.7% in 2028 and 1.8% in 2029.In her Budget speech, the chancellor said the government had “beat” the growth forecast this year and “we will beat them again”. …
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[mwai_chat context=”Let’s have a discussion about this article:nnThe UK economy is expected to grow at a slower rate than previously expected from next year, the government’s official forecaster has said.The Office for Budget Responsibility (OBR), which maps out how the economy is set to perform based on the government’s tax and spending policies, increased its growth expectations for this year, but downgraded its forecast for the following four.It said lower productivity growth – a measure of output of the economy per hour worked – was behind the weaker growth forecast.The OBR’s forecast was published in error ahead of the Chancellor Rachel Reeves delivering her Budget on Wednesday.The OBR apologised for what it called a “technical error” and said an investigation was under way into how the error occurred. Reeves said the mistake was “deeply disappointing”.In its forecast, the OBR predicted the economy would grow by 1.5% this year, higher than its previous estimate of 1%.However, it said growth would be lower at 1.4% in 2026 and 1.5% in the following four years – all of which are downgrades from its forecast made in March.”We expect quarterly growth to pick up only gradually in the near term as geopolitical uncertainty persists and domestic business and consumer confidence remains subdued, including in anticipation of further tax rises,” the OBR said.Previously growth had been expected to hit 1.9% next year, 1.8% in 2027, 1.7% in 2028 and 1.8% in 2029.In her Budget speech, the chancellor said the government had “beat” the growth forecast this year and “we will beat them again”. …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]
