Budget prompts economists into hasty forecast revisions

Economists are broadly positive on the plans announced in the emergency Budget and are scrambling to revise their own growth forecasts in light of the austerity measures.

George Osborne forecast slower UK GDP growth in the next five years - 1.2% this year and 2.3% in 2011, followed by 2.8% in 2012, 2.9% in 2013 and 2.7% in 2014 and 2015. The 2.6% forecast for 2011 is down from the 3%-3.5% estimate made in the last Labour Budget three months ago. Neptune's chief economist James Dowey says the revised growth forecasts are fair and achievable with the past fall in sterling if the Bank of England cooperates and keeps interest rates low even if inflation remains above target. Keith Wade, chief economist at Schroders, has reduced his growth forecasts due ...