Comment: Osborne glee- but questions remain


The IMF's upgrade for the UK economy will be greeted with glee in 11 Downing Street.

It comes nine months after George Osborne was drawn into a spat with the IMF’s chief economist, Olivier Blanchard. The Chancellor dismissed him as “one voice, one person”.

The numbers are falling in Osborne’s favour: unemployment is sliding, inflation is back to the 2 per cent target and next week’s official estimates should show the economy growing at around 0.8 per cent for the third quarter in a row.

But you don’t have to scratch beneath the surface to sense the IMF’s reservations about the global recovery: its update, entitled “ Is the Tide Rising?” raises a pointed question. The world faces two risks — deflation and ending emergency monetary policy — which could land us straight back in the mire.

At home, the questions for Osborne over whether businesses will follow up a consumer revival with spending of their own haven’t gone away.