UK finance minister to set out budget measures in March, if needed

DAVOS, Switzerland, Jan 23 (Reuters) - British finance minister Rachel Reeves told Reuters on Thursday she will set out new budget measures in March if needed to meet her fiscal rules but said it was important not to "rush ahead" with just two months to go.

"We have asked the independent Office for Budget Responsibility to produce a forecast that will be published on March 26, and at that point I will set out any changes that are necessary," Reeves said in an interview on the sidelines of the World Economic Forum's annual meeting in Davos, Switzerland.

"I don't think we should rush ahead. (There are) still two months to go before the OBR produces its forecast."

Earlier this month, a sharp sell-off in British government debt, largely driven by a change in U.S. interest rate expectations ahead of Donald Trump's presidential inauguration, prompted Reeves to say she would act to meet her fiscal rules if necessary.

Market borrowing costs have fallen back in the last week, however, and as of Thursday British gilts were the third-best performing bonds among Group of Seven countries this year.

"If you look at the performance year-to-date, we are in line with our peer group in terms of our bond yields," Reeves said.

Of the spike in yields earlier this month, Reeves said: "It's not a UK phenomenon. It's not a UK-specific issue."

Since her Oct. 30 budget, which increased borrowing and taxes on businesses to help pay for increased spending on public services and investment, economic data has turned more against Reeves, increasing the chance that she will have to do more to meet her rules.

These rules include balancing day-to-day spending with revenue by the end of the decade and getting net public sector financial liabilities falling as a share of gross domestic product.

"We are removing the barriers that have prevented businesses from investing and growing in the UK," Reeves said.

"I am confident we can get those growth figures up."

(Reporting by Alexander Smith; Writing by Andy Bruce; Editing by William Schomberg and Hugh Lawson)