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UK economy to grow at 'robust pace', forecasts OECD

Published 09/11/2015

Britain's growth will continue to outstrip the eurozone, says the OECD
Britain's growth will continue to outstrip the eurozone, says the OECD

Britain's economy will continue to grow at a "robust pace" over the coming two years, according to the Organisation for Economic Co-operation and Development (OECD).

In its latest Economic Outlook, the Paris-based OECD said that with a forecast annual growth rate of 2.4% for this year and next - easing back slightly to 2.3% in 2017 - UK performance would continue to outstrip the euroezone.

Employment is projected to carry on growing - although at a slower pace - while inflation will pick up from 2016 as the temporary effects of cheap energy prices and a strong pound unwind.

The OECD sounded a warning note about the continuing strength of the housing market, cautioning it could lead to a shortage of rental properties and "boost household indebtedness, creating financial stability risks".

It also expressed concern about the effect of the introduction of the national living wage on employment levels.

"The magnitude of their impacts is uncertain, but a higher minimum wage could hurt employment by pricing out low productivity workers from the labour market and result in losses of competitiveness if not matched by stronger productivity," it said.

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