UK autumn statement in focus – RBC CM

Research Team at RBC Capital Markets, suggests that the new UK Chancellor will deliver his first major fiscal statement since taking over from Osborne, where he will present the government’s economic policy response to the EU referendum result.

Key Quotes

“Despite initial market expectations of a major role for fiscal stimulus, we think a deteriorating macroeconomic forecast will boost borrowing to the extent that it constrains scope for discretionary fiscal easing. The favoured tool for what loosening there could be looks to be public sector investment spending targeted at road and rail maintenance. For 2016–17 it is anticipated that the borrowing requirement will increase £8bn, and over the five-year horizon more than £100bn of extra borrowing is forecast.”