Can the government hit a new 2.5% growth target?

In his mini-Budget slated for next Friday, the new Chancellor reportedly intends to set an official target of raising real GDP growth to 2.5% a year. But with productivity growth and labour force growth likely to remain subdued for some time, we suspect the economy’s potential growth rate will be closer to 1.0-1.5% in the 2020s than 2.5%.

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