George Osborne braced for bad news on deficit reduction - London Report

George Osborne is now unlikely to meet fiscal targets for the year (Source: Getty)
Public finance figures due out tomorrow are likely to be a blow to chancellor George Osborne, with tax receipts lowered by very low earnings growth.

Economists predict that Osborne is now unlikely to meet fiscal targets for the year, despite improved economic activity, stronger house prices and an improved labour market.

Howard Archer, of IHS Global Insight, said: “While changes may make comparative analysis of the public finances more confusing, the message is clear – the chancellor now looks highly unlikely to meet his fiscal targets for 2014/15.

“This means that the chancellor will face an awkward fiscal backdrop as he announces his Autumn Statement in December as the May 2015 general election draws every nearer. This gives him little scope to announce any major sweeteners. It also means that extra fiscal tightening will be needed in the new parliament.”

In other economic news, Wednesday’s minutes of the latest Bank of England Monetary Policy Committee meeting will give clues as to whether members are becoming less convinced of the case for an interest rate hike in the next few months.

The corporate week starts today with news from McBride and Lok ‘n’ Store.

Tomorrow fashion house Asos gives final figures, while Arm Holdings, Devro, GKN, Go-Ahead Group, InterContinental Hotels, Reckitt Benckiser Group, Whitbread and William Hill will update the market.

On Wednesday British American Tobacco, Computacenter, GlaxoSmithKline, Home Retail Group, International Personal Finance, Laird, Playtech, Plus500 and Senior all due to give figures, while Petropavlovs will release production results.

On Thursday Debenhams, Hochschild Mining and Volution Group are all due to give end-of-year results. African Barrick Gold, Bloomsbury Publishing, Britvic, Colt, Inchcape, Ladbrokes, Mecom, Phoenix Group, Photo-Me, Premier Foods, Reed Elsevier, River and Mercantile, Segro, Stobart Group, Tesco and Unilever will also report. Anglo American will release production results.

On Friday Pearson, Shire, Spectris, TSB Banking Group and Vesuvius will update the market.

Update: This article was changed to reflect the fact that National Express’ third quarter interim management statement will be announced on Thursday 30 October and not Thursday 23 October as originally stated.

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