It could have been worse. Today's official figures show that the economy grew by a meager 0.1 percent in the last three months of last year.
It was feared that the economy had actually been contracted – so there will be some lighting on Downing Street and with the treasury.
Rachel Reeves can even afford a smile – it is her birthday.
However, companies and households may not be that chipper.
Because the harsh reality is that the economy has been crushed since the birth came to power – crushed by the gloomy rhetoric and business bashing budget of the Chancellor. And it is the standard of living of millions that will suffer.
Mrs. Reeves inherited the fastest growing economy among the group of seven (G7) rich nations when she came to power at the beginning of July.
But £ 40 billion in tax increases – including a 'tax on jobs' of £ 25 billion that the Manifesto of the Labor Party has violated – have derailed the hope of a long -term recovery.
At the same time, inflation is hot again, so that the fears are fed that Britian is about to be a new era of 'stagflation'.
Rachel Reeves can even afford a smile – it is her birthday. However, companies and households may not be that chipper (file image)
GDP rose by 0.1 percent between October and December – hardly any detectable, but considerably better than the 0.1 percent contracted analysts were in the neighborhood
That is when economies stagnate, but prices continue to rise – the standard of living of millions of depressing.
All this makes grim reading for the Chancellor, cruel called 'Rachel From Accounts' by her critics in the midst of claiming that she beautifully decorated her economic references on her CV.
But the real pain is felt by households and companies throughout the country in the form of higher taxes, stubborn loan costs, lower wages, fewer vacancies, rising costs and lower profit.
Simply put – millions are worse off.
Many companies will completely make the store closed, because the £ 40 billion in tax increases by Mrs Reeves in her budget bite announced in October in the coming months.
The contrast with Trump America is surprising – with business confidence on the one hand of the Atlantic Ocean, just as the 'animal spirits' of entrepreneurship on the other are crushed.
However, this can simply be the beginning.
It is now clear that the Office for Budget Responsibility has reduced the prospects for the British economy in such a way that the Chancellor will violate its own tax rules next month.
The updated predictions of the Bank of England suggested last week that inflation is slower than hoped, and the growth has been weaker than expected
At the time of the last budget, the OBR cost this year in growth of 2 percent and Mrs Reeves gave himself around £ 10 billion in tax headroom.
The Bank of England lowered its growth reasons to 0.75 percent last week, while Consultancy Capital Economics predicts the expansion of only 0.5 percent.
Even if the OBR does not go that far, every downgrade can be disastrous for Mrs. Reeves if she struggles to get her budget numbers to rise.
This is because weaker growth is affecting tax receptions – the amount that the treasury brings in to pay everything from schools and hospitals to the police and forces.
At the same time, modest economic growth encourages government spending on areas such as unemployment benefits.
Expenditure on the maintenance of the national debt has also risen because the interest rates on the global bond markets are higher – although the Bank of England has lowered its benchmark costs of borrowing.
So Mrs. Reeves earns less than she hoped by spending taxes and more on benefits and debt payments – jeopardize her tax rules.
All this before any increase in defense expenditure – as required by President Trump.
Rachel Reeves received a lifeline today, because the economy unexpectedly grew in the last quarter of last year
The big problem is her so -called “stability rule” stating that daily government spending must be paid by taxes.
The choices that the Chancellor is confronted with are grim.
She could break her tax rule. But this would be a political and economic humiliation that she will never recover. And she stays that the rules are 'iron covered' and 'non-negotiable'.
She could lift taxes. But the economy has already been put to his knees by the tax increases announced in October – including the £ 25 billion national insurance policies 'tax on jobs'.
And Mrs. Reeves can be reluctant to break another promise after he had told business leaders after the budget that she was 'really clear' – 'I will not come back with more borrowing or more taxes'.
So that leaves the expenses by a Chancellor who has also promised 'there will be no return to cuts'.
This determines the scene for a political confrontation with its cabinet colleagues whose departmental budgets are in danger and its public sector Union Paymasters.
But although the update of March 26 of the OBR proves headaches for Mrs. Reeves, it is the livelihood of millions who are really at risk due to the economic malaise of Great Britain under labor.
