This morning, March 19th 2033, UK CPI (Consumer Price Inflation) finally edged below 6% for the first time in more than a decade. City analysts see no immediate reason why The Bank of Britain (“BOB”) should consider an early rate cut – expecting The Bank will keep the base rate at 8% for the foreseeable future on the basis England and Scotland’s continuing trade surpluses and full employment are positives, although continued Scottish threats to abandon the dual currency have the potential to undermine confidence in Sterling.
Who would have thought I’d be writing about the UK’s economic success a decade ago?
While the last 10-years has seen some wild swings, and more than a few moments of doubt, today the City – well, what is now the decentralised centre of the Western World’s Financial system – is busier than ever financing private enterprise and growth. We are like most large financial firms, maintaining an office in London’s policed Zone A, but we’re far more likely to meet colleagues and clients in our regional offices across the South of England’s commuter belt. My own office window overlooks the Cathedral in Winchester. Direct Flights across Europe and to the Gulf are 20 mins away at Southampton International.
10-years ago I feared for the future of Britain’s financial markets. Then my headlines were about Brexit failure, and the collapse of the UK’s “Virtuous Sovereign Trinity” of gilt market sustainability, sterling strength and political competency. The unified United Kingdom government looked on the verge of fracture as the nation was riven by recession, strikes, and a hostile relationship with Europe.
Remarkably, following the much feted “night of the long knives” Premier Sunak successfully purged his own party of right-wing Brexiteer extremists, the turn-around was swift. Although Sunak lost the subsequent election, his re-engagement deal with Europe, supported by the Labour Party, turned around the negative growth narrative. From their exile in North Korea, Boris Johnson and Jacob Rees-Mogg still rail against the injustice of it all.
Following Sunak’s coup, years of chronic underinvestment by foreign businesses into the old UK was reversed. From almost zero battery and chip industries, the UK is now among the largest and most efficient of the European producers. In 2024 Premier Starmer’s government committed the UK to growth. While remaining resolutely outside Europe but very much re-engaged within, the UK re-joined science and industrial European agencies.
