GDP to grow 2.9pc in 2014

The prediction is an increase of 0.4 percentage points on the previous forecast three months ago, while it would mean that GDP will exceed 2008 levels within a few months.

Real wages are also expected to grow this year despite standing 6% below 2009 levels, yet they are not expected to make up lost ground until 2018.

Unemployment will average about 6.5%, yet this is expected to fall to 6% from 2015.

CPI inflation is projected to stay close to the 2% target.