But the result in five years’ time was roughly the same in terms of where the economy would end up. The OBR forecasts inflation will rise from the 0.7% rate enjoyed by consumers over 2016 to 2.4% this year and stand at 2.3% in 2018. The National Institute of Economic and Social Research (Niesr), a respected thinktank, described the OBR’s inflation forecast as “too conservative”. We expect that inflation will be a greater challenge to the UK economy than the OBR currently predicts, with price growth overtaking pay growth this year. This is likely to squeeze consumer spending, a key driver of UK growth,” said its head of economics, Suren Thiru.

Source: The Guardian March 08, 2017 19:52 UTC