Relief for Osborne as IMF expects UK growth to hit highest rate in three years
The International Monetary Fund is expected to raise its estimate of growth in the UK economy tomorrow, in figures that will be seized upon by George Osborne, the Chancellor.
Reports were circulating last night that the IMF will upgrade its estimate of GDP growth in 2014 to 2.4 per cent, having estimated in its October round of forecasts that growth will come in at just 1.9 per cent.
Such an upgrade would put the IMF in line with the most recent estimate from the Treasury’s Office for Budget Responsibility, and reflect the fact that a host of economic indicators have significantly exceeded expectations over the past four months since its last outlook.
The Office for National Statistics reports that the economy grew by 0.8 per cent in the third quarter of the financial year, after expanding at the same rate in the second quarter. Most forecasters anticipate a similar expansion again in the final quarter. That would take full year growth for 2013 to around 1.4 per cent, the fastest registered since 2010.
However, 2.4 per cent growth in 2014 would still be lower than the 2.7 per cent average forecast from private sector analysts.
The British Chambers of Commerce is expecting GDP to grow by 2.8 per cent in 2014, while the Ernst & Young Item Club predicted full year growth yesterday of 2.7 per cent.
An upgrade from the IMF would be seen by the Chancellor as a vindication, since the Fund last year joined those calling for the Government to slow down its planned spending cuts.
The IMF’s chief economist, Olivier Blanchard, warned Mr Osborne that he was “playing with fire” by sticking to his austerity policies at a time when the economy seemed to be on the verge of a triple-dip recession.
In October the IMF estimated that the global economy would grow by 3.6 per cent in 2014. That is also expected to be upgraded slightly, following better news recently from the US.
- 2 Mystery man who gave mum heart-warming note on train 'wanted to put a smile on her face'
- 5 Amal Clooney gives excellent answer to fashion question at European Court of Human Rights
King Salman: Just five days in, Saudi Arabia's new king has already overseen a beheading
Mystery man who gave mum heart-warming note on train 'wanted to put a smile on her face'
Michelle Obama highlights harsh restrictions faced by Saudi women after meeting King Salman without wearing a headscarf
Amal Clooney gives excellent answer to fashion question at European Court of Human Rights
Mafia's wall of silence broken: Victim of Cosa Nostra's extortion rackets in its Corleone heartland co-operates with authorities for the first time ever
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
Liberal Democrat minister defends comments suggesting immigration causes pub closures
iJobs Money & Business
£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...
£25000 - £35000 per annum: Recruitment Genius: A Technical Report Writer is re...
Competitive salary & benefits!: MBDA UK Ltd: MBDA UK LTD Indirect Procurement...
£16500 - £16640 per annum: Recruitment Genius: This fast growing Finance compa...