Possible scenario
Tax-Led Budget
40% Chance
Chancellor Rachel Reeves accepts most of the IFS arithmetic and prepares a large tax package to protect NHS, schools and local government budgets. This is the most likely path because Labour has already signalled reluctance to return to visible austerity, while gilt-market credibility remains a binding constraint after 2022.
Initial impacts
- Market volatility Down
- Riskier companies' borrowing costs Down
- 10-year Treasury yield Down
- US dollar Down
Secondary impacts
- Consumer Cyclicals -0.6%
- Consumer Services -0.4%
Portfolio impact
S&P 500-0.0%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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