OECD Says UK Economic Outlook Brightens as Government Measures Boost Growth

The outlook for the UK economy has brightened, according to the Paris-based Organisation for Economic Co-operation and Development (OECD), which said inflation has come in lower than expected while new government support measures are likely to boost growth.

The OECD significantly cut its inflation forecast for the UK this year, lowering it from 3.7% to 3.1%, after prices rose less sharply than the think tank had previously anticipated. The revised forecast points to a somewhat less painful cost-of-living picture for British households and businesses than earlier projected.

The assessment comes as the UK government has introduced new measures aimed at supporting economic activity, which the OECD credited with helping to improve growth prospects. Details of the specific measures and their expected impact on gross domestic product were not fully outlined in the available reporting.

The OECD's periodic economic outlooks are closely watched by policymakers, investors and businesses as a gauge of how major economies are expected to perform in the near term. A more favorable UK outlook could ease some of the pressure facing the government as it navigates ongoing questions about the public finances and the cost of living.

The report on the UK came alongside broader financial market developments, including a decline in oil prices over recent sessions, though the OECD's comments were focused specifically on inflation and domestic growth conditions in Britain. Further details on the OECD's full outlook were expected to be published in due course.