OBR slashes UK growth forecast for 2027 despite Healey’s budget measures
Source: The Guardian ·
Outlook for living standards also downgraded as part of impact of Middle East conflict on economyHealey offers £100 payment to households to help navigate ‘global economic storms’Budget 2026: key points at a glanceBudget 2026 live – latest updatesBritain’s economy has taken a multibillion-pound hit as the war in the Middle East drags down growth and triggers a fresh cost of living crisis,…
From the source
Britain’s economy has taken a multibillion-pound hit as the war in the Middle East drags down growth and triggers a fresh cost of living crisis, according to the government’s independent forecaster. In a report as John Healey announced his first budget, the Office for Budget Responsibility (OBR) issued a sharp downgrade for growth, living standards and the public finances despite the measures taken by the chancellor. Although Healey sought to cushion the blow through “breathing space” policies to help households and businesses with soaring energy costs, the watchdog slashed its growth forecasts for 2027 and warned that inflation was poised to reach close to 4% as Britain’s early resilience to the war fizzles out. While growth this year was upgraded from 1.1% to 1.2% after an unexpectedly resilient performance fuelled by AI investment, the watchdog slashed its estimate for next year from 1.6% to 1%. Highlighting the damage from Donald Trump’s war in the Gulf, Healey said the exchequer…