The Confederation of British Industries has downgraded its growth forecasts for the UK economy for 2015 and 2016, as the uncertainty of a US rate hike takes its toll.

It now expects GDP to grow by 2.4% in 2015, down from a previous forecast of 2.6 percent. This lack of economic growth will come as bad news for chancellor George Osborne, who is due to make a speech later today announcing a further 30 percent budget cut.

However, despite the downgrade, the forecasts remain slightly above average for the British economy.

CBI director-general John Cridland said in a statement:

“Manufacturers are enduring tougher conditions as a persistently strong pound is hamstringing our export competitiveness. But our domestic story is strong and overall we are now in a phase of stable but solid economic growth.”

He called for “solid foundations” to support the economy, including a final decision on expanding airport capacity.