George Osborne has been accused of “playing with fire” by the chief economist of the International Monetary Fund, who suggested that the Chancellor should have done more in his Budget last month to stimulate growth.
Mr Osborne was also urged yesterday to consider delaying some deficit-cutting measures as the international body cut back sharply its growth forecast for the UK.
The Institute of Economic Affairs rejected the IMF view. “The Chancellor cannot endlessly postpone his plan to get the debt and deficit under control. Weak growth forecasts simply underscore that we are spending more than we can realistically afford,” Mark Littlewood, its director, said.
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