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Tax cuts now imply tax rises after the election

Whatever the Chancellor gives away in tax cuts in the Budget, the next government will have to take away in the form of tax hikes after the election. This means any fiscal sugar rush for the economy after the Budget won’t last and tighter fiscal policy in 2025 supports our view that interest rates will end 2025 at 3.00%, lower than current market pricing of 4.00%.

Note: We will be discussing what the policies announced in the Budget mean for the economy and the financial markets in a 20-minute online briefing shortly after the Budget at 3pm GMT on Wednesday 6th March. (Register here.)

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