Treasury officials anticipate a substantial downward revision, with some describing it as a 'kitchen sink' approach to the forecast downgrade.

Chancellor Rachel Reeves is expected to respond by emphasizing long-term investment strategies aimed at boosting productivity amidst these forecast challenges.

The government is considering policy reforms, such as planning reforms, to stimulate growth and offset the negative effects of the productivity downgrade.

The revised forecast could lead to a reduction in GDP by 1.4% over five years, prompting the government to consider increasing taxes or cutting around £20 billion in spending to meet fiscal targets.

The UK Office for Budget Responsibility (OBR) is expected to significantly downgrade its productivity growth forecasts ahead of the November 26 budget, which could lead to a notable impact on the country's economic outlook.

This downgrade is projected to reduce GDP over five years by approximately 1.4%, potentially forcing the government to increase taxes or cut spending by around £20 billion to meet fiscal rules.

Economists estimate that the UK government may need to implement over 20 billion pounds in fiscal tightening, with some projections exceeding 50 billion pounds, to address the fiscal shortfall.

The forecast downgrade indicates increased fiscal pressures, likely resulting in higher taxes, which could include hikes on banks or other revenue sources.

Despite these challenges, the government aims to keep taxes low for working people, resisting calls for increases in income tax, VAT, or national insurance, with policies under review by a strengthened budget oversight body.

The overall fiscal gap in the upcoming budget is significant, with recent political U-turns on welfare and fuel allowances factored into the OBR's assessment of limited fiscal headroom.

The March forecast indicated only about 9.9 billion pounds of fiscal leeway for 2029/30, highlighting the limited room for maneuver ahead of the budget.

The downgrade is expected to be substantial, with some officials suggesting a 'kitchen sink' approach, reflecting the seriousness of the forecast revision.