The UK's economic growth for 2027 is now expected to be lower than previously forecast, an international agency has stated. The Organisation for Economic Co-operation and Development (OECD) has moderately downgraded its prediction, anticipating 1% growth for 2027, down from an earlier forecast of 1.1%.
Conversely, the OECD has upgraded the UK's growth outlook for the current year, 2026, from an expected 0.9% to 1.1%. This short-term increase is attributed to "solid domestic demand growth."
The agency indicated that higher fuel prices, linked to the ongoing US-Israel war in Iran, are expected to contribute to the lower growth in 2027. The OECD also highlighted that global economic risks include the conflict in the Middle East and climate-change related supply shocks, which could affect oil and gas prices and potentially food prices.
These predictions emerge as Chancellor John Healey is due to present his first Budget at the end of October.