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The UK economy is expected to grow at a slightly faster pace than previously forecast, amid a faster easing of inflation pressures, according to an average of City forecasts released the government on Wednesday.
UK gross domestic product is expected to grow by 0.3% in 2023, according to an average of independent forecasts collated by the Treasury. It is a marginally more bullish growth outlook than the 0.2% from independent forecasts in July.
Inflation expectations have fallen. The inflation rate for 2023 is now expected to be 4.5%, according to August’s forecast, lower than the 4.9% prediction in July’s survey. The Office for National Statistics on Wednesday reported that UK consumer price inflation was 6.8% in July, cooling from 7.9% in June.
Based on the average of new forecasts alone, so those received between August 1 and 11 only, the rate of inflation for 2023 is expected to be 4.4%. For 2024, it is expected to be 2.6%.
The UK unemployment rate at the end of the year is forecast to be at 4.1%, unchanged from the July expectation.
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