Rachel Reeves Braces for “Awful April” as Flat Growth and Soaring Debt Spark Economic Fears!

Rachel Reeves is facing growing pressure ahead of her Spring Statement, with economic experts warning of an “awful April” as the UK struggles with sluggish growth and rising debt. The Chancellor will have a crucial moment this Friday, when the latest GDP figures are released, giving a snapshot of the economy just weeks before a series of tax hikes come into effect.

Harry Mills, Director at Oku Markets, explained that the focus will shift back to the Government after a few weeks of relative calm, thanks to Sir Keir Starmer’s recent performances and the ongoing chaos in the White House. “That ends on Friday with the latest monthly GDP data, ahead of an important month for UK PLC, with various tax rises slated for April,” he said, reported the Express.

Mills pointed to the UK’s ongoing economic struggles since Labour came into power, including consecutive quarters of flat or near-flat growth, a debt-to-GDP ratio exceeding 100%, and a sharp decline in business and consumer confidence. “No matter which way you look at it, this is an anaemic performance, and it likely won’t ease off soon,” he warned.

The GDP figures expected on Friday are likely to show just 0.1% growth for January, with contractions in industrial and manufacturing production. Experts are particularly concerned about the tax changes coming in April, including National Insurance Contributions (NIC) and stamp duty increases, which could further slow economic momentum.

The Office for Budget Responsibility (OBR) is set to revise its growth projections on March 26, and the Bank of England has already cut its 2025 forecast in half, fueling fears of prolonged stagnation. Tony Redondo, Founder of Cosmos Currency Exchange, compared the UK economy to a struggling vehicle. “At best, Friday’s MOT on the UK economy will show lots of advisory notes; at worst, the car will be ready for salvage by the end of the second quarter once the tax rises hit home.”

He also warned that the upcoming NIC and stamp duty hikes, along with rising utility costs, will keep inflation high, leaving the Bank of England hoping they won’t have to raise interest rates again, which could further damage the economy. “The pain is not fully priced in, and we still have the spring spending review to be announced on March 26,” he added.

The Spring Statement will be a critical moment for Rachel Reeves, who must balance managing a fragile economy with Labour’s commitment to fiscal responsibility. Business leaders are growing increasingly vocal about the risks of higher taxes and regulatory burdens, with Gabriel McKeown, Head of Macroeconomics at Sad Rabbit, saying, “The idea that Britain’s economy is powering ahead is more wishful thinking than economic reality.”

Sir Keir Starmer has suggested that Reeves won’t be making “big” decisions on tax and spending, but experts are closely watching how the Government navigates these challenging times.