Rachel Reeves to claim Labour 'has the right plan for Britain' and the economy is stronger under her watch in Spring Statement

Falling inflation and interest rate cuts are two of the points expected to be cited by Ms Reeves as indicators of a successful economy.

The Bank of England downgraded its growth rating for the economy just weeks ago.

At the beginning of February, the Bank's GDP forecasts for 2026 were downgraded to 0.9 per cent from 1.2 per cent, and to 1.5 per cent from 1.6 per cent for 2027.

But today, Ms Reeves will say: "This Government has the right economic plan for our country… in a world that has become yet more uncertain.

"Stability in the public finances, investment in infrastructure and reform to our economy.

"Building growth not on the contribution of a few people or a few parts of the country, but in every part of Britain with a state that doesn’t stand back, but steps up."

She will later add: "Because of the decisions we have already taken, we have a stronger and more secure economy. Inflation and interest rates falling. And in every part of Britain, working people are better off."

Ministers - including the Chancellor herself - have played down expectations of the spring statement, and said no new tax or spend policies will be announced.

Ms Reeves could still make minor changes to tax policy - which may risk accusations of deploying stealth taxes.

Her address has instead been sold itself as a response to the latest economic forecasting by the OBR.

Opposition parties have however called on Ms Reeves to use the statement to make significant changes.

The Liberal Democrats, in another attack on Labour's relationship with Donald Trump, have urged the Government to use the statement to publish an assessment of the pharmaceuticals deal with the US.

The agreement between the two countries means the US does not impose tariffs on British made drugs, but in return the UK pays more for access to American medicines.

Liberal Democrat-commissioned polling claimed the majority of Britons want the deal to be abandoned and for cash spent on US medicines to instead be spent directly on care in the UK.

While small businesses have warned that 400,000 UK firms could be forced to shut down if their concerns go unaddressed on Tuesday.

The statement, expected to be "low-key" by analysts, is expected to be delivered at approximately midday in the Commons.

But it risks being overshadowed by war in Iran.

Markets have faced a wave of turbulence after conflict broke out in Iran, with the FTSE 100 and value of the British pound both plummeting at market open on Monday.

Oil prices surged after ships in the Strait of Hormuz were attacked and have cast fresh doubt over UK interest rate expectations.