UK growth forecasts downgraded for next two years

UK growth forecasts downgraded for next two years

The UK economy will grow much more slowly than previously thought over the next two years as inflation takes longer to come down, the government’s economic forecaster has warned.

The Office for Budget Responsibility (OBR) said the economy would grow by 0.7% in 2024 and 1.4% in 2025.

That is down from a forecast in March of 1.8% and 2.5%.

The OBR added that the rate of UK price rises would not return to normal until 2025, a year later than expected.

However, the outlook, which was published alongside the chancellor’s Autumn Statement, suggested that government borrowing and debt would both be lower than previously forecast.

The spending watchdog, which is independent from government, publishes two sets of economic forecasts a year, which are used to predict what will happen to government finances.

These are based on its best guess about what will happen, and are subject to change.