Spring Statement 2018: OBR revises up GDP; Inflation to fall to 2%

Chewing gum on show

Similarly, while Hammond was able to announce that the OBR had cut its estimate of government borrowing in the current 2017/18 financial year by nearly £5bn to just over £45bn, this was the result of a cyclical rather than a structural improvement in the state of the public finances.

Those forecasts, based on the assumption that Britain would stay in the European Union, saw growth of above 2 percent for each year between 2018 and 2021.

Looking at employment, Hammond said he expected to see 500,000 more people in work by 2022.

"I am pleased to report. on a United Kingdom economy that has grown in every year since 2010", Hammond told lawmakers.

"It is also good to see the business rates valuation brought forward to 2021".

"A lot will depend on what happens with sterling and oil prices, and with retailers suffering so much the temptation to put up prices to mitigate lower volumes will be strong, and that's before you consider the impact of the incoming living wage".

The OBR improved its forecast for economic growth for 2018, predicting GDP would increase by 1.5% for the year, up from its prediction of 1.4% in November 2017.

"The Chancellor has kept his word and made very few policy changes in today's Spring Statement, choosing instead to wait until the Autumn Budget to assess whether he can ease the fiscal consolidation", Samuel Tombs, chief United Kingdom economist at Pantheon Macroeconomics, commented, as quoted by Proactive Investors.

The gist of the 243-page OBR economic and fiscal outlook is that nothing has really changed since it last reported less than four months ago.

More news: PUBG is getting a new map, vehicles, weapons, and emotes in 2018

The statement used to act as a "mini-budget", but Hammond has broken with tradition and pledged to deliver only one budget a year, in the Autumn.

Hinting at a boost in public spending, the Chancellor said: "If, in the autumn, the public finances continue to reflect the improvements that today's report hints at then I would have capacity to enable further increases in public spending and investment in the years ahead, while continuing to drive value for money to ensure that not a single penny of precious taxpayers' money is wasted". Some 215,000 new homes are also scheduled to be built in the West Midlands by 2031.

Furthermore, the government has said that it is working with 44 areas which have submitted bids to the Housing Infrastructure fund, to make sure that only those homes that are needed are being built.

On the back of Tuesday's improved figures, Mr Hammond said: "There is indeed light at the end of the tunnel".

He also said the Department for Education would release up to £80 million to help small businesses with the apprenticeship levy.

'The stamp duty concessions have definitely prompted more interest among first-time buyers, who are often taking the place of investors at the lower end of the market.

The markets, though, warmed to Hammond's speech and sterling rose slightly against the dollar, no doubt fuelled by comments hailing the United Kingdom as an "outward looking free trading nation" whose "best days are ahead of us".

He said the country could not risk allowing Labour to derail progress and cautioned: "We are not out of the tunnel yet". Either way, Hammond delivered a fine political speech.

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