Within his first Budget speech, Chancellor Philip Hammond reported on ‘an economy that has continued to confound commentators with robust growth’.
In its report prepared for the Budget, the Office for Budget Responsibility (OBR) now predicts that the UK economy will grow by 2% this year, as opposed to its previous forecast of 1.4%.
Economic growth is, however, expected to slow to 1.6% during 2018, subsequently rising again to 2% by 2021.
The Chancellor commented that the steady growth will provide a ‘strong and stable platform’ for the UK economy as Britain enters EU exit talks.
Meanwhile, the OBR also revealed that it predicts government borrowing will fall from last year’s rate of 3.8% of GDP to 2.6% this year.
The figure is expected to rise to 2.9% in 2018/19, but fall to 0.7% during 2021/22.
However, the Chancellor struck a cautionary note and announced a continued commitment to the government’s fiscal policy.
Commenting on the UK economic picture, Mr Hammond said: ‘We must focus relentlessly on keeping Britain at the cutting edge of the global economy.
‘Our task . . . is to take the next steps in preparing Britain for a global future.’