UK Productivity Growth Forecast Slashed Amid Global Challenges

The UK's Office for Budget Responsibility has cut its medium-term productivity growth forecast to 1%. This adjustment, down from 1.3% in March, is influenced by global trade policy and structural trends, not government policies, affecting Britain's future economic potential.

The Office for Budget Responsibility (OBR) in the UK has revised its medium-term productivity growth forecast to 1%, a dip from the earlier 1.3% prediction made in March. This news comes as a prelude to finance minister Rachel Reeves' upcoming budget statement.

The OBR's lower forecast reflects persistent challenges in UK's productivity, which, according to the watchdog, has continually underperformed expectations since 2010. Factors contributing to this downturn are tied to a lack of recovery following recent economic shocks.

Notably, the OBR emphasized that this downgrade isn't due to any specific government policy but rather stems from broader global trade policies and structural trends that could impact Britain's economic productivity moving forward.

(With inputs from agencies.)