Chancellor Rishi Sunak revealed during the Budget 2021 that unemployment is expected to peak at 5.2%, according to the Office for Budget Responsibility (OBR).
As a result, Sunak said this will mean: “over two million fewer people will be out of work than previously feared.”
The OBR expects gross domestic product (GDP) to expand by 6.5% this year, compared to the 4% forecast at the Budget 2021 in March.
This is below what the Bank of England has predicted, which is 7.4% of growth.
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UK GDP rose by 5.5% between April and June, compared with the first three months of the year, more than any other country within the G7 group.
Rising inflation has been predicted to reach 3.1% and likely to rise further.
Sunak said this is due to global factors, such as the world opening up after the pandemic and demands for goods increasing.
Addressing Parliament, Sunak said if recovery is strong, the government will be able to return to spending 0.7% of GDP on overseas aid by 2024, and that spending is growing by 3.8% a year in real terms.
By Jake Carter
Source: Mortgage Introducer
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