Bank of England Is Back to Reality After Truss Fiasco
A two-year recession could be in store for the UK, but mortgage holders might just catch a slight break.
The UK’s situation is so dire a recession is now inevitable.
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The last meeting of the Bank of England’s monetary policy committee was only seven weeks ago, but to economic policymakers it seems like a lifetime. The country has a new prime minister and a new chancellor of the exchequer, while Britain’s bond and currency markets have endured a crisis for the ages. The upshot of all the excitement is that the MPC can belatedly correct an error from September. Back then, it narrowly decided to hike rates by only 50 basis points, rather than following others with a 75 basis-point hike — only to learn the next day that the government intended to administer a huge stimulus in the form of unfunded tax cuts.