![\"WASHINGTON,](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2025\/04\/1_President-Trump-Meets-With-El-Salvador-President-Nayib-Bukele-At-The-White-House.jpg\")
Donald Trump(Image: Win McNamee, Getty Images)<\/p>\nThe downgraded forecasts make it more likely that Labour Chancellor Rachel Reeves will have to make further cuts or hike taxes in her autumn budget.Donald Trump(Image: Win McNamee, Getty Images)<\/p>\n
The fallout <\/a>from Donald Trump’s tariffs is set to hit the UK harder than Europe, according to the International Monetary Fund (IMF).<\/p>\n The IMF said UK growth is down by 0.5 per cent from January’s forecast. This means our economy <\/a>will only grow by 1.1 per cent next year and 1.4 per cent the year after.<\/p>\n It makes it more likely that Labour Chancellor Rachel Reeves will have to make further cuts or hike taxes in her autumn budget.<\/p>\n The IMF\u2019s top economist Pierre-Olivier Gourinchas said: \u201cWhile many of the scheduled tariff increases are on hold for now, the combination of measures and countermeasures has hiked US and global tariff rates to centennial highs.<\/p>\n \u201cFor this reason, we expect that the sharp increase on April 2 in both tariffs <\/a>and uncertainty will lead to a significant slowdown in global growth in the near term.\u201d<\/p>\n The UK’s fall <\/a>in worse than the 0.2 per cent decrease that Europe is facing.<\/p>\n This is despite Trump’s suggested 20 per cent tariff <\/a>on the EU being double the UK’s 10 per cent levy.<\/p>\n But the UK’s growth <\/a>forecast for this year of 1.1 per cent is still higher than Europe’s 0.8 per cent rate.<\/p>\n READ MORE: Clyde Tunnel could close as control room workers balloted over strike action<\/a>READ MORE: ScotRail alcohol ban ‘ignored’ by passengers as SNP policy branded ‘unenforceable’<\/a><\/p>\n The fall in UK growth <\/a>is due to Trump’s tariffs driving up the cost of UK Government borrowing and sky-high energy costs because of Russia’s invasion of Ukraine.<\/p>\n Reeves said the new forecasts <\/a>show \u201cthe UK is still the fastest-growing\u201d European country in the G7.<\/p>\n \u201cThe IMF <\/a>have recognised that this Government is delivering reform which will drive up long-term growth in the UK, through our Plan for Change,\u201d she said.<\/p>\n \u201cThe report also clearly shows that the world has changed, which is why I will be in Washington this week defending British interests and making the case for free and fair trade.\u201d<\/p>\n The IMF boosted Britain’s forecasts <\/a>for 2028 and 2029 by 0.1 per cent each.<\/p>\n Reeves already raised national insurance for employers in last year’s budget and introduced benefit cuts in the spring statement.<\/p>\n The IMF <\/a>said it expects the UK to have higher inflation than other countries.<\/p>\n It warned in the forecast<\/a>: \u201cThe United Kingdom and the United States stand out in both the direction and the magnitude of their revisions\u201d.<\/p>\n![](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2025\/04\/0_UK-Chancellor-Rachel-Reeves.jpg\")
Rachel Reeves could face some tough decisions(Image: (Image: Getty))<\/p>\n