UK economy set to shrink next year, Hunt says in budget speech

Britain's economy has come under strain from an inflation rate now above 11%

Chancellor of the Exchequer Jeremy Hunt: "Forecasts laid out "starkly the impact of global headwinds on the UK economy"

Britain's economy is forecast to shrink next year, finance minister Jeremy Hunt said as he began outlining how he and Prime Minister Rishi Sunak will raise taxes and cut spending to repair the public finances, despite the grim outlook.

The new forecast is for gross domestic product to contract by 1.4% next year compared with a projection for growth of 1.8% in the previous outlook published in March by the Office for Budget Responsibility (OBR).