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Huge political U-turn, but where does this leave the BOE?

UK
  • This is probably the biggest U-turn I can remember in recent UK political history...
  • Apart from the reversal of the NIC hike and the energy price guarantee (that has been limited to April 2023 rather than October 2024), pretty much everything is gone.
  • This will mean a lot less borrowing... But what does it mean for the MPC? Now that there are less stimulatory tax measures, but the upside risks to inflation will now be higher in the short-term too. The certainty over energy prices is now gone. So this still doesn't leave the MPC in a comfortable position...

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