Bank Rate in BoE downside scenario looks more convincing

The Chancellor gave the biggest hint yet this week that large tax rises are coming in the Budget on 26^th November. Our view that she will raise taxes by around £38bn, which would weigh on inflation, adds to our view that interest rates will fall from 4.00% now to 3.00% next year rather than to 3.50% as investors anticipate. That would be similar to the path for interest rates in the Bank of England's downside scenario.

We'll be discussing what the Budget could mean for the UK economy, UK housing and the financial markets in a 20-minute online briefing at 3pm GMT on Wednesday 19^th November. (Register here.)