IMF set to lift UK growth forecast

Tuesday 21 January 2014

The International Monetary Fund (IMF) will publish its latest economic projections today amid reports that it is to lift its growth forecast for the UK to 2.4% this year.

It will mean Britain is expected to be among the fastest growing of the world's advanced economies during 2014, offering a fresh boost to Chancellor George Osborne. The IMF has already had to sharply upgrade growth projections for the UK after the unexpectedly strong advances in the economy during 2013.

But its latest World Economic Outlook, to be released this afternoon, is expected to raise the forecast growth level for 2014 above the 1.9% level predicted in its previous bulletin in October - which itself was up from a forecast in July of 1.5%.

A figure of 2.4% would be in line with the latest outlook from Britain's independent Office for Budget Responsibility, which upgraded its own figures at the time of Mr Osborne's Autumn Statement last month.

It underscores how quickly optimism about the UK economy has increased, just nine months after the IMF urged the Government to rethink its austerity strategy, with the fund's chief economist telling Mr Osborne he was "playing with fire".

Data from the Office for National Statistics (ONS) next week will round off the picture of GDP growth in 2013, after it increased by 0.5% in the first quarter before accelerating to 0.8% in the second and another 0.8% in the third quarter.

There are hopes that the strong pace will have been maintained when the ONS publishes data for the final period of 2013.