OECD Cuts UK’s 2027 Growth Forecast as Debt and Inflation Keep Rising
The OECD has revised its UK growth forecast for 2027 down to 1.1%, reflecting ongoing economic challenges. Despite a slight improvement in growth this year, inflation and debt levels continue to rise, with inflation projected at 3.7% for this year. The outlook remains grim, with unemployment expected to increase and the deficit remaining high.
- ▪The OECD has cut its UK growth forecast for 2027 to 1.1%.
- ▪Inflation is projected to reach 3.7% this year and remain above target in 2027.
- ▪Debt is expected to rise above 105% of GDP, with a deficit above 4%.
- ▪Unemployment is forecasted to climb to 5.5%.
- ▪The 2026 growth figure is revised to 0.9%, down from 1.4% last year.
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The OECD has cut its UK growth forecast for 2027 to 1.1%, down from the 1.3% it expected in March, a detail Rachel Reeves conveniently skipped over today as she welcomed slightly higher growth this year and inflation a smidge lower than previously forecast. As if the country woke up this morning grateful for her heroism… The 2026 figure is still anaemic at best. At 0.9%, it beats the 0.7% the OECD predicted in spring, but it marks a slowdown from 1.4% last year and leaves Britain near the bottom of the G7. The improvement largely reflects a stronger first quarter, before the war in Iran pushed up energy prices. Elsewhere, the picture is bleak… Inflation is set to reach 3.7% this year and remain above target at 2.4% in 2027.
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