As Chancellor Rishi Sunak made his Spring Statement this afternoon, the Office for Budget Responsibility announced that inflation and tax rises will cause living standards to fall by 2.2% in 2022-23, the greatest fall since records began in 1956.
Sunak warned in his speech that the OBR report had not accounted for the full impact of the Russian invasion of Ukraine and "we should be prepared for the economy and public finances to worsen, potentially significantly". After news on Wednesday morning that inflation hit 6.2% in February, the OBR said today that it expects inflation to average 7.4% this year. The Bank of England had previously warned that inflation could reach as high as 8%, but the OBR now sees inflation hitting a 40-year high of 8.7% in the fourth quarter of this year. Inflation is then predicted to fall to 4% i...
To continue reading this article...
Join Professional Adviser for free
Signup and gain exclusive members-only insights
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes
