Mark Berrisford Smith
Sailing close to the wind: UK Spring Budget 2023 Latest Economic commentary from HSBCs Mark Berrisford Smith
Key points
Jeremy Hunt’s Spring Budget delivered a modest fiscal stimulus, with the aim of boosting investment spending by businesses and increasing labour market participation, while also offering further assistance in coming months with household energy bills.
The forecasts presented by the OBR no longer anticipate a recession, and project the annual rate of inflation to be back at around 3% by the end of this year.
But the fiscal forecasts have very little headroom, with the key measure of debt as a percentage of GDP expected to fall by a fractional 0.2 percentage points in 2027/28. Without further improvement in the economic and fiscal outlook, the government may struggle to deliver some of its cherished ambitions without making tough choices in other areas.
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