Treasury watchdog says Rachel Reeves will also face higher borrowing costs in report issued alongside spring statement

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Rachel Reeves must cope with lower growth and higher borrowing costs this year, as the Treasury’s independent forecaster said the global economic situation was more unpredictable and could worsen in 2025.

In a report to coincide with the chancellor’s spring statement, the Office for Budget Responsibility (OBR) said the economic outlook was “more challenging” and “more uncertain” as it forecast that growth would halve this year to 1% from its 2% prediction at the time of October’s budget.