The International Monetary Fund (IMF) could be forced into an embarrassing U-turn this week and upgrade growth forecasts for the U.K, analysts said on Monday.
“It seems highly likely that they will revise growth up,” George Buckley, chief U.K. economist at Deutsche Bank, told CNBC on Monday.
The IMF downgraded its growth forecasts for the U.K. in April over concerns about the austerity program headed by the country’s finance minister, George Osborne, sparking a war of words between the minister and the organization.
The IMF’s chief economist, Oliver Blanchard, told Osborne he was “playing with fire” and should “consider adjustment to the original fiscal plans.” Osborne responded by saying there was “no plan B for the U.K. economy” and that he would stick to implementing billions of pounds worth of spending cuts.
The IMF predicted the U.K. economy would grow by 0.7 percent this year and by 1.5 percent in 2014 – cutting both forecasts by 0.3 percentage points.
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