UK economic recovery is on track according to Chancellor George Osbourne

Chancellor George Osborne says UK economic recovery is "on track" despite "challenging" global conditions.His statement came as a response to the Office for Budget Responsibility's (OBR) upgrading of its 2010 growth forecast, but lowering of those for 2011 and 2012.The Chancellor stated that the UK economy was moving towards "sustainable growth", with increased export and investment.

Labour has insisted that this years growth was a product of its policies, citing Coalition cut plans as a "reckless gamble".

The chancellor's  statement to MPs was being closesly monitored by financial markets looking to see how well the coalition's deficit reduction plan was coming progressing, especially in the light of events in Ireland and elsewhere in the eurozone.

The OBR, formed in May to assess public finances prior to each budget,has revised its growth forecast for this year from 1.2% to 1.8%, but it has lowered its estimate for 2011 from 2.3% to 2.1% and that for 2012 from 2.8% to 2.6%.

Additionally it has cut its forecast for public sector job losses over the next four years from 490,000 to 330,000.