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UK GDP on course to outpace its rivals

The UK is on course to outpace the world's major advanced economies this year after the International Monetary Fund (IMF) raised its GDP forecast for a fourth time in a row to 3.2 per cent.

The projection, which is disclosed in the IMF's World Economic Outlook, is better than forecasts that the United States will grow by 1.7 per cent this year, Germany by 1.9 per cent and Canada by 2.2 per cent.

As well as the 0.4 per cent upgrade to its April forecast, the IMF has added 0.2 per cent to its prediction for 2015, when the UK should grow by 2.7 per cent.

Since last year's forecast by the IMF that the UK would grow by just 1.5 per cent in 2014, the recovery has been driven by consumer spending and a tentative rebound in manufacturing.

Chancellor George Osborne said: "Today the IMF has upgraded their 2014 forecast for the UK by more than any other major economy.

"The Government's long term economic plan is working. But the job is not yet done and so we will go on making the assessment of what needs to be done to secure a brighter economic future."

The IMF rounded down growth for the global economy from 3.7 per cent in April to 3.4 per cent today.

IMF director Olivier Blanchard said: "The recovery continues, but it remains a weak recovery."

TUC general secretary Frances O'Grady said: "Pay packets are still falling behind rising prices, so most people are not yet sharing in the recovery.

"If the good news on growth is going to last, real wages must start improving."

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