Speaking to our economics and data editor, Ed Conway, at the IMF meeting in Marrakech, the chancellor has said that although there are reasons to be optimistic about the UK economy, there a huge challenges ahead.
Jeremy Hunt said the economy “has proved to be much more resilient than nearly every international organisation predicted” and there are a number of “underlying strengths”.
But he went on: “We have a challenge with inflation, which is still too high, and we have the challenge of the international environment where there are still a lot of shocks. And so I need as chancellor to focus on resilience in the face of those shocks.
“I am very much hoping for the best, but I do need to prepare for the worst because I think we can see that the world is a very dangerous place right now.”
He said the economic numbers are “definitely worse than what I faced in the spring” as the UK’s “debt interest is likely to be 20 to £30bn higher this year” than predicted.
But he said: “I have a great deal of confidence providing we take the difficult decisions necessary to get inflation down, to get our borrowing back under control. If we do these kinds of things, then we can be very confident of our future.”
The chancellor also hit out at Labour, saying that while Rishi Sunak is “prepared to take difficult decisions” and “do things differently if they’re the right things for the country”, the Labour Party is “not prepared” to do so.