5 Spring Forecast | 3 March 2026 With little more than three months since the OBR published (slightly prematurely…) its last Economic and Fiscal Outlook (EFO), it was likely there would be few significant changes in the numbers. Growth As the table above shows, the OBR’S projection for economic growth in the current year has been cut to 1.1%, bringing it into line with the February market consensus, but still above last month’s Bank of England’s forecast of 0.9%. The OBR increased its projections for growth in both 2027 and 2028 to 1.6% (from 1.5%), largely countering the impact of its 2026 reduction over its five-year forecast period. Inflation The OBR’s inflation projection for this year was cut by 0.2% to 2.3%, which closely matches the Bank of England’s own estimate for inflation. To a degree this fall of inflation has been engineered by the government with the actions it has taken on administered prices, such as the energy price cap and rail fares. OBR projections Autumn Budget 2025 vs Spring Forecast 2026 OBR projection November 2025 March 2026 GDP growth 2026 1.4% 1.1% GDP growth 2027 1.5% 1.6% CPI inflation 2026 2.5% 2.3% CPI inflation 2027 2.0% 2.0% LFS* unemployment 2026 4.9% 5.3% LFS* unemployment 2027 4.6% 4.9% Average oil price per barrel 2026 $64.38 $63.09 Bank rate 2026/27 3.6% 3.4% Bank rate 2027/28 3.7% 3.6% Weighted average gilt yield 2026/27 4.7% 4.5% Weighted average gilt yield 2027/28 4.9% 4.8% Fiscal headroom 2029/30 £21.7bn £23.6bn Public sector net financial liabilities 2029/30 83.0% GDP 82.2% GDP Public sector net borrowing 2026/27 £112.1bn £115.5bn Public sector net debt 2026/27 95.3% GDP 94.8% GDP * Labour Force Survey Source: Office for Budget Responsibility Spring Forecast 2026
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