Citywire for Financial Professionals
Stay connected:

View the article online at

Budget watchdog to downgrade UK growth

Office for Budget Responsibility is poised to forecast a more pessimistic outlook, restricting chancellor Philip Hammond’s options in next month’s Budget.

Budget watchdog to downgrade UK growth

Chancellor Philip Hammond will find himself in a very tight spot at next month’s Budget as new analysis from the Office for Budget Responsibility (OBR) is expected to forecast a more pessimistic outlook for the UK, the Financial Times has reported.

According to the report, the OBR’s analysis will say UK productivity has been frequently over-estimated and will forecast slower growth.

This forecast could knock off two-thirds from the Chancellor’s £26 billion breathing room in public finances which was set aside to protect the economy against Brexit.

With the Treasury targeting a deficit of less than 2% of national income by 2020-21, Treasury officials told the Financial Times the OBR’s forecast cut would leave him with less than £10 billion to play with at the Budget.

Such a position would be very difficult politically for the Chancellor as the government is under a lot of pressure to end the public sector pay cap.

It also comes at a time when prime minister Theresa May is under intense pressure over her own position after the Conservative Party Conference this week was marred by her calamitous closing speech.

This morning Grant Shapps, a former Conservative Party chairman, told the BBC around 30 MPs support a move to call another leadership race and he is one of leaders of the group.

Shapps told the BBC Conservative MPs are justified in seeking to replace May after the summer’s disappointing election result.

leave a comment

Please sign in here or register here to comment. It is free to register and only takes a minute or two.

News sponsored by:

The Citywire Guide to Investment Trusts

In this guide to investment trusts, produced in association with Aberdeen Asset Management, we spoke to many of the leading experts in the field to find out more.

Watch Now

More about this:

What others are saying


Today's articles

Tools from Citywire Money

From the Forums

+ Start a new discussion

Weekly email from The Lolly

Get simple, easy ways to make more from your money. Just enter your email address below

An error occured while subscribing your email. Please try again later.

Thank you for registering for your weekly newsletter from The Lolly.

Keep an eye out for us in your inbox, and please add to your safe senders list so we don't get junked.


FTSE falls below 7,000 as Trump plans China tariffs

by Daniel Grote on Mar 22, 2018 at 11:07

Sorry, this link is not
quite ready yet