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Jeremy Hunt might be going on the spending cuts next month

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Chancellor of the Exchequer Hunt

It’s no longer just a U-turn in UK fiscal policy. They’ve now completed the turn and are speeding in the other direction.

Chancellor of the Exchequer Jeremy Hunt delayed the planned Oct 31 budget to Nov 17 today and now Bloomberg reports that he’s seeking to fill a budget shortfall of £35 billion by drawing up a menu of 104 options to cut spending. It will also include a full forecast from the OBR.

The move complicates the Nov 3 Bank of England decision, as they won’t get to see the fiscal plan first. Market pricing suggests a 64% chance of 75 bps and 35% chance of 100 bps.

A big question is how the UK will subsidize energy prices this winter. Perhaps Truss’ biggest blunder was capping energy bills at £3000 in a move that offered no incentive for conservation and an unlimited fiscal liability for the government. At the moment, LNG prices have fallen but that could quickly change once the weather turns.