Reeves needs trade deal as economic gloom deepens

The International Monetary Fund IMF) has slashed the UK’s economic growth forecast in a fresh blow to Rachel Reeves, upping the ante as the chancellor prepared to hold talks in Washington DC.

- KATE DEVLIN

Ms Reeves is expected to have her first face-to-face meeting with her US counterpart, Treasury Secretary Scott Bessent, as she pursues a new economic agreement the UK hopes can offset some of the cost of Donald Trump’s trade tariffs.

But the news of the growth downgrade, more severe than the prediction for the rest of Europe, will increase the pressure on the chancellor to secure a deal – or face the spectre of tax rises or even more spending cuts later this year.

Ms Reeves had hoped to use this week’s visit to Washington to try to turn around Britain’s economic fortunes.

The government has been warning about the need to get growth into the economy for months.

But the IMF downgrade lays bare the effects of the US president’s trade tariffs, which have wreaked havoc on the world economy since they were announced and then, at least partially, paused.

James Smith, research director at the Resolution Foundation think tank, told