UK Chancellor sees (dim) light at end of tunnel
Schroders' Chief Economist Keith Wade comments on the UK's Spring Statement
“For what was meant to be a simple economic statement, the Chancellor turned much of the first Spring Statement into a political opportunity to have a dig at Labour with barbs about red books and oncoming trains.
“Certainly he did have an opportunity to unveil stronger growth for this year alongside a forecast of UK inflation falling back to target by the end of the year. Government borrowing has returned to surplus, excluding investment, and debt is set to peak. All good news.
“However, much of this was anticipated and it is still fairly cautious with only a modest upward revision to growth of 0.1% to 1.5% this year. We should not be surprised: it’s too early in the political cycle for anything more bullish and the Chancellor himself said that forecasts are there to be beaten.
“No mention though of the UK being the weakest economy in the G7 at a time when the rest of the world is booming. We welcome the initiatives on housing and training, areas key to getting productivity back on track and boosting long-run growth.”
To read the March forecasts of Schroders’ Economics team in full – which includes a more in-depth analysis of the health of the UK economy and the Bank of England’s interest rate strategy – please click here.
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Notes to Editors
Important Information: The views and opinions contained herein are those of Keith Wade, Chief Economist, Schroders, and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. This material is intended to be for information purposes only and is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The material is not intended to provide and should not be relied on for accounting, legal or tax advice, or investment recommendations. Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. All investments involve risks including the risk of possible loss of principal. Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy. Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. The opinions in this document include some forecasted views. We believe we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know. However, there is no guarantee than any forecasts or opinions will be realised. These views and opinions may change.