Britain's largest business goup, the Confederation of British Industry, has cut forecasts for UK economic growth following October's Autumn Budget.
Investment and hiring plans risked being set back in the wake of the Budget, the CBI said, after chancellor Rachel Reeves unveiled £40 billion worth of tax increases.
Economic growth of 0.9% was predicted for 2024, against its previous forecast of 1.0%, while its expectation for next year was dialled down from 1.9% to 1.6%.
“Measures in the autumn Budget will increase firms’ costs at a time when their profit margins have already been under pressure,” chief economist Louise Hellem said.
“Many businesses have told us that these measures will likely push up prices and weigh on their hiring and investment plans going forward.”
Inflation was forecast to average 2.6% through 2025 and 2.5% in 2026, as the likes of hospitality and retail price growth provided upward pressure.
AJ Bell chief executive Michael Summersgill slated the Budget over "some very clumsy proposals" in the meantime.
"The narrative ahead of this Budget was out of line with the Budget that was ultimately delivered," he said.
“Do I think that there’s a risk that they come back and they look to raise more taxes through the course of this Parliament? Yes, I think there is.
“I didn’t see anything in the October Budget that was pro growth and pro investment and that concerns me."