OECD Cuts UK Growth Forecasts Amid Trade Tensions

The OECD has downgraded the UK's economic growth forecasts for 2025 and 2026 to 1.4% and 1.2% respectively, amid global economic slowdowns and trade tensions initiated by US tariffs under President Trump. The downgrades pose a challenge to UK Chancellor Rachel Reeves ahead of her Spring Statement, where she faces a potential £15 billion shortfall in government finances. Globally, the OECD expects growth to slow to 3.1% in 2025 and 3% in 2026, with US growth projections also reduced to 2.2% and 1.6% for the same years. Trade barriers and higher inflation are anticipated to affect living standards worldwide, with Canada and Mexico facing significant economic contractions. Despite these challenges, the UK is projected to remain one of the fastest-growing G7 economies, second only to the US, according to Rachel Reeves.