UK budget will promise higher GDP but pressure firms

Significance Recent figures suggest that the UK economy is improving, with stronger growth and lower inflation than previously expected, although growth prospects remain weak historically. Impacts Bond market investors may worry that higher borrowing will lead to higher interest rates on UK government debt. More public-sector investment and planning reforms should boost construction and infrastructure prospects, as well as clean energy firms. Small and medium-sized firms may reduce employment or cut wages to offset higher National Insurance contributions and more worker rights. Attracting foreign investment will be key; a recent summit gained GBP63bn in commitments from multinationals -- though not all new money.