The independent Office for Budget Responsibility will warn that stubbornly high inflation and soaring borrowing costs are adding to the challenges facing Rishi Sunak, making it less likely that he will meet one of his five key pledges - tackling Britain's public debt.
It is understood the OBR will produce a range of scenarios in its annual "fiscal risks and sustainability report" today, setting out the impact of higher interest rates for the public purse, in a warning that sustained pressure could force it to tear up its official forecasts.
The OBR said it would "assess the fiscal implications of recent rises in global interest rates, the vulnerability of the UK's current debt position, and explore the challenges in getting debt to fall in the coming years".
At the start of the year Sunak based three of his five priorities on the economy: halving inflation, growing the economy and getting debt falling.
However, leading economists warned that failure on his top priority to reduce inflation was placing all three in danger, as the Bank of England's rapid rate rises increased the prospect of a recession, and as higher inflation and borrowing costs added billions of pounds to the government's debt interest bill.
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Denne historien er fra July 13, 2023-utgaven av The Guardian.
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