{"id":509331,"date":"2026-03-07T14:09:07","date_gmt":"2026-03-07T14:09:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/509331\/"},"modified":"2026-03-07T14:09:07","modified_gmt":"2026-03-07T14:09:07","slug":"rachel-reeves-in-flames-just-as-thought-worst-was-over-its-blown-up-personal-finance-finance","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/509331\/","title":{"rendered":"Rachel Reeves in flames \u2013 just as thought worst was over it\u2019s blown up | Personal Finance | Finance"},"content":{"rendered":"

You make your own luck in life, so it\u2019s hardly surprising Rachel Reeves has been so short of it. When you go to the country pledging no new taxes on \u201cworking people\u201d, then hit them with \u00a375billion in just 18 months, you don\u2019t deserve much sympathy. If you try to snatch the winter fuel payment from single pensioners on as little as \u00a311,350 a year<\/a>, no amount of luck can save you. If you drive up unemployment by slapping crippling taxes on jobs, you\u2019re on your own. And if you deliver a Budget that plunges the economy into panic and stagnation, luck walks out the door.<\/p>\n

Yet for a moment it seemed her luck had turned<\/a>. Reeves and Keir Starmer<\/a> always knew the first couple of years in power would be painful, as voters discovered what Labour really had in store for them after all those soothing pre-election promises. But they hoped that by the time the next election rolled around in 2029, voters might finally feel a little better off. That\u2019s why they planned to hammer the cost-of-living message this year.<\/p>\n

With inflation expected to fall to 2% by the spring, Reeves hoped households might start to feel a little better off. Now that strategy has been shot down in flames.<\/p>\n

Falling inflation would have opened the door for further interest rate<\/a> cuts, easing pressure on businesses, consumers and homeowners. Lower rates would also have reduced gilt yields and government borrowing costs, giving Reeves a little more fiscal headroom. With luck, she might even have avoided new tax rises in the next Budget. Although knowing Reeves, she’d probably have hiked them anyway.<\/p>\n

Reeves was dying to claim the credit for falling inflatino, but the truth is it would have fallen much faster if she hadn\u2019t piled on the tax hikes while handing the public sector inflation-busting pay increases. In Europe, interest rates<\/a> hit 2% months ago. In Britain they remain stuck around 3.75%, thanks in part to her.<\/p>\n

Oil prices are already surging. Barely 10 days ago a barrel of crude cost around $70. Now it\u2019s pushing $95, a three-year high. Some warn it could hit $150 or $200. Drivers are already feeling that at the pumps. Soon it will ripple across the entire economy, including in food prices. UK borrowing costs are rising at the fastest rate since the disastrous Liz Truss mini-Budget in September 2022, costing us billions. They’ll also drive mortgage<\/a> rates back up.<\/p>\n

Reeves repeatedly insists she’s \u201crestored stability\u201d to the public finances. Yet growth has ground to a halt, and the UK\u2019s debt and deficit remain sky high. Plus we have to pump tens of billions into defence, with our armed forces in dire straits.<\/p>\n

As the war spreads and sucks in more countries, the cost-of-living squeeze will return with a vengeance. And since Labour\u2019s backbenchers refuse to tolerate spending cuts while the bond market balks at lending even more, the burden may fall on taxpayers again. This autumn’s Budget could be another horror show. Let\u2019s hope this is a short war, the Chancellor\u2019s luck won\u2019t survive a long one. Nor will the UK economy.<\/p>\n","protected":false},"excerpt":{"rendered":"You make your own luck in life, so it\u2019s hardly surprising Rachel Reeves has been so short of…\n","protected":false},"author":2,"featured_media":509332,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[28,101,2402,3730,231209,3732,97245],"class_list":{"0":"post-509331","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-inflation","11":"tag-labour-party","12":"tag-labour-party-policies","13":"tag-rachel-reeves","14":"tag-uk-economy"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/509331","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=509331"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/509331\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/509332"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=509331"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=509331"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=509331"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}