As I expected, Morrgan McSweeney has gone.
I remain quite sure that Starmer will go.
And in the short term, there will be a cost to this. There are three obvious ones.
First, the pound is likely to dip in value. That has a short-term inflationary impact. It will be short-term, but it will happen.
Second, this means interest rates will still be too high when we need them to fall. The Bank of England will say there is an inflation risk now, and people will pay the price in higher mortgage and other borrowing costs, as will businesses, and the government itself.
Third, if Reeves reacts as she usually does, with the backing of the Treasury, which is accustomed to deliver austerity whenever it can, then public services might also be punished. Remember, another fiscal event is coming up in early March. It could be costly for those in need while uncertainty remains.
This is why I have suggested an alternative plan Labour needs to adopt here.
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Interesting where this could go.
On the subject of Reeves, there was an article in the Telegraph today claiming the treasury have urged Reeves not to deliver her spring statement, because the treasury dont wont to upset the markets.
I do not know the full implications of this – which is why I read this blog. This, however, is not right surely.
As for McSweeney – are the dominoes finally falling?
Reeves has no choice but deliver. I don’t believe the story.
And yes the dominoes are falling but I still think Starmer goes in May.