We’d recommend ignoring any reports on the back of next week’s data releases that the UK economy is heading in the wrong direction on inflation and activity. It may only be a few months before inflation is back below 2.0% and an economic recovery is underway. Meanwhile, Labour’s decision to jettison its £28bn green investment pledge is due to fiscal constraints caused by low GDP growth and high interest rates. The government and Labour have yet to fully acknowledge the fiscal reality.
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