Budget borrowing will slow Bank of England rate cuts, economists warn

Economists have cautioned that increased government spending could likely cause the Bank of England to decelerate the rate of interest cuts over the next year.

Chancellor Rachel Reeves is aiming to generate £40bn in the forthcoming week's Budget to support increased public service spending, primarily through tax hikes, as reported by City AM.

In addition to these measures, it is probable that Reeves will modify fiscal rules to permit more government borrowing for public investment.

Pantheon Macroeconomics' economists stated that the "growth-depressing impact" of higher taxes would likely be "roughly cancelled out" by the enhancement to e