UK growth will be weaker than previously expected this year and next, according to the Organisation for Economic Co-operation and Development (OECD).

The OECD cut its predictions for UK growth to 1.4% in 2025 and 1.2% in 2026, down from 1.7% and 1.3%, respectively.

The OECD said global growth would slow from 3.2% in 2024 to 3.1% in 2025 largely as a result of trade tensions sparked by President Trump.

In a stark warning, the OECD said in its interim economic outlook report that ‘consumers face much of the burden of higher tariffs’ as it cautioned over a significant impact on living standards.

The report shows that inflation in the G20 group of countries will rise to 3.8% this year and 3.2% next year.

Chancellor of the Exchequer, Rachel Reeves, said: ‘This report shows the world is changing, and increased global headwinds such as trade uncertainty are being felt across the board. ‘A changing world means Britain must change too, and we are delivering a new era of stability, security and renewal, to protect working people and keep our country safe. ‘This means we can better respond to global uncertainty, with the UK forecast to be Europe’s fastest growing G7 economy over the coming years – second only to the US.’