The prospect of more tax hikes in the Budget in November adds to our view that inflation in the UK won’t remain higher than in the euro-zone and that the Bank of England will cut interest rates from 4.00% now to 3.00% next year rather than to 3.50% as investors expect. We’re not expecting the economy to be derailed by a fiscal crisis, although the risk of a crisis is real.
We'll be discussing the outlook for the UK economy and the financial markets in a 20-minute online Drop-In at 3pm BST on Wednesday 1st October. (Register here.)
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services