Today’s Budget was largely as expected. Much of the content had been flagged beforehand, and then there were the big manifesto pledges that were off limits. But that’s not to say it wasn’t a significant Budget, and it may indeed be the last, or penultimate, big spending Budget. Rishi Sunak today announced £37.5billion of spending in the current financial year and the next. Apart from last year’s Budget, it is, by any historical comparisons outside of the pandemic, a huge amount of spending. What’s concerning though is that spending in future years is going to be cut at progressively larger amounts, and next April will therefore herald the start of four consecutive years of public spending cuts. On the tax front, there were further cuts or extensions of existing tax cuts in some areas but also tax rises in others.Continue reading
Chief Economist’s Weekly Briefing – Light relief
Does June’s unexpected fall in the rate of inflation herald the start of a retreat? It seems unlikely. The fall in sterling that has helped push inflation higher is still filtering through into consumer prices. And even at the lower rate inflation remains uncomfortably above wage growth. That’s a considerable headwind for the economy.
Budget Preview: Will a spoonful of sugar (tax) help the austerity go down?
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Today George Osborne will deliver his eighth Budget. If you add in Autumn Statements and Spending Reviews, the current Chancellor has delivered thirteen fiscal events before he gets to his feet today. Horse racing enthusiasts would pour over these to assess the Chancellor’s fiscal form and make predictions on what we may expect to see. Continue reading
Chief Economist’s Weekly Brief – Hard Work
We’re all at risk of robots stealing our jobs, or so futurologists are fond of saying. For now though the UK is creating plenty of jobs for humans. The problem remains woeful productivity and weak wage growth.
Retailers may well have come out of the red on Black Friday
For seasoned investors, the term ‘Black Monday’ is a reminder of the global stock market crash that occurred on 19 October 1987. Meanwhile the Wall Street Crash (29th October 1929) was also known as ‘Black Tuesday’. This was when panic selling reached its peak and followed steep share price falls on the previous day, ‘Black Monday’, and on the 24th October 1929, ‘Black Thursday’. The third day of the week hasn’t escaped the prefix ‘Black’ either, with the 16th September 1992 dubbed ‘Black Wednesday’ in the UK. This was when currency market speculators forced the UK to remove sterling from the Exchange Rate Mechanism (ERM).