The OBR is forecasting growth of 2.7% this year, an increase on the 2.4% expansion it predicted in December. This is the largest upwards revision between Budgets for 30 years, the Chancellor said,
Growth for 2015 is expected to come in at 2.3%, up from the 2.2% previously forecast, and 2.6% for 2016-2017, before returning to its long-term trend level of 2.5% in 2018.
“We are putting Britain right, but the job is far from done,” George Osborne said as he delivered what he called a “Budget for building a resilient economy”.
He added the UK economy will be £16bn larger than was predicted at the time of the Autumn Statement four months ago.
The economy posted growth of 1.9% for 2013 as a whole, the fastest rate of growth since 2007. Today unemployment fell by 63,000 to 2.33m in the three months to January, with the jobless rate at 7.2%, hinting at an improving economy.
In last year’s Budget, the OBR halved its growth forecast for the UK economy for 2013 to 0.6%, below the consensus expectation of 0.9%.
In December, the OBR also revised down its forecast for growth in 2014 to 1.8%.
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