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U.K. Cuts 2017 Growth Forecast and Plans to Increase Borrowing

  • GDP to grow 1.4% in 2017 instead of 2.2% predicted in March
  • Britain to borrow extra 122 billion pounds through 2020-21
Bloomberg business news

Hammond: U.K. Growth Forecast 1.4% in 2017

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U.K. Chancellor of the Exchequer Philip Hammond laid out a somber framework for post-Brexit Britain, slashing the forecast for economic growth in 2017 and saying the government will need to borrow more over the next five years partly as a result of the vote to leave the European Union.

Outlining his Autumn Statement to Parliament on Wednesday, five months to the day after Britain opted to quit the EU, Hammond said the Office for Budget Responsibility now sees economic growth next year of 1.4 percent instead of the 2.2 percent forecast in March. The cumulative budget deficit will also widen, with just under half the extra 122 billion pounds ($151 billion) foreseen through 2021 -- 58.7 billion pounds -- a direct result of the referendum result, the Treasury said in documents published to accompany Hammond’s statement.