Britain's economy will grow by 3.25 per cent this year, in line with earlier forecasts, Chancellor of the Exchequer Mr Gordon Brown said today.
In his pre-budget report to parliament, Mr Brown also forecast growth of 3 to 3.5 per cent in 2005 and hailed the "longest period of uninterrupted growth in the industrial history of our country".
In his March budget, Mr Brown forecast growth of 3 to 3.5 per cent for this year and next year. He predicted inflation in Britain would be just 1.75 per cent next year and 2 per cent thereafter.
"In any other decade, a 100 per cent increase in oil prices, a 50 per cent rise in industrial materials prices and a 70 per cent rise in metal prices would have led to inflation and instability," Mr Brown said.
"But with continued and necessary discipline among wage bargainers in the private and public sector and the resilience of our new monetary and fiscal framework, inflation is expected to be just 1.75 per cent next year and 2 per cent in the years to follow."
Mr Brown said an expected moderation in house price inflation was now under way and he forecast consumption to grow by 3.25 per cent this year and by 2.25-2.75 per cent in 2005.