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Such imbalances “leave the UK more exposed to economic shocks and reduces our productive potential.
“The downside risks to the outlook are increasing. Russia's invasion of Ukraine could drive a renewed economic downturn if it stalls activity by triggering a sustained dislocation of supply chains or a more significant inflationary surge.”
The Government has been criticised for a lack of deregulation of the economy since Brexit – something which it is now able to do – and for not putting off planned tax rises.
It is set to push ahead with a 1.25 percent rise in National Insurance in April, and bring in a 25 percent corporation tax in Spring 2023.