Responding to the latest OECD economic outlook, Dr Valentin Boboc, Senior Economist at the Institute of Economic Affairs said:

“The OECD’s numbers confirm the country’s fiscal and economic vulnerabilities predate the current crisis. The UK entered this supply shock with weak growth, a cooling labour market and already elevated energy prices – which is why we are forecast to take the biggest hit from the war out of the major economies.

“The government should tread carefully on the policy response. Broad demand subsidies risk making inflation stickier and pushing up borrowing costs, making it harder for investment and employment to recover. Priority should be given to removing the barriers that prevent the economy from producing more.”