Chancellor’s plans could be knocked off course by global crisis, poor growth or interest rate shocks, report says
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The International Monetary Fund has said the UK government risks being knocked off course in meeting its targets to repair the public finances and urged Rachel Reeves to give herself more leeway through tax or spending measures.
In a final version of an annual report on the UK economy, the Washington-based organisation said changes introduced by the chancellor to the government’s deficit reduction plans had enhanced the credibility and effectiveness of fiscal policy.
“Risks to this strategy must be carefully managed. In an uncertain global environment and with limited fiscal headroom, fiscal rules could easily be breached if growth disappoints or interest rate shocks materialise,” the IMF said.
