- Falling inflation and a lower fiscal deficit allowed the government to announce tax cuts in last week’s Autumn Statement.
- With further tax cuts likely in March 2024, the Bank of England could adopt a more cautious stance to easing monetary policy.
- UK economic data has shown signs of picking up. Energy prices have eased, and real incomes are rising. Rising immigration should help counter wage inflation, however.
- Rate cuts in 2024 still seem likely but the UK now looks set to lag the US and Europe in reducing borrowing costs.