# What’s in Store for Britain’s Autumn Statement?
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2016-11-12
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Chancellor Philip Hammond to Deliver Critical Autumn Statement
Meta Description: Get insights into UK's post-Brexit economic future with Chancellor Philip Hammond's first Autumn Statement. Discover new tax incentives and budget
URL: https://financedigest.com/whats-in-store-for-britains-autumn-statementhtml

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**Evdokia Pitsillidou** at easyMarkets

Chancellor of the Exchequer Philip Hammond will deliver his first Autumn Statement before UK Parliament. This year’s address is considered especially critical given the UK’s recent fallout from the European Union.

Mr. Hammond picks up where former Chancellor George Osborne left off. Mr. Osborne was urged to [resign after Prime Minister](https://www.financedigest.com/liz-truss-resigns-after-six-weeks-as-uk-prime-minister.html "Liz Truss resigns after six weeks as UK prime minister") David Cameron called it quits in the wake of the June 23 Brexit vote.

Unlike his predecessor, Hammond’s options are limited as Britain’s financial [future remains](https://www.financedigest.com/fingerprint-scanners-to-remain-top-selling-accounting-for-over-one-third-of-access-control-demand-in-2021-future-market-insights.html "Fingerprint Scanners to Remain Top-selling, Accounting for Over One-third of Access Control Demand in 2021: Future Market Insights") uncertain. The prospects of [higher inflation and slower economic growth are expected to leave a £25 billion hole in the public purse by the end](https://www.financedigest.com/britains-kingfisher-sees-annual-profit-towards-higher-end-of-forecasts.html "Britain’s Kingfisher sees annual profit towards higher end of forecasts") of the current parliament.

The Autumn Statement is the first major fiscal event since the Brexit vote. It replaces the annual budget only in name, as it is still expected to speak to British finances, albeit in less weighty terms. Hammond will have all the time he [needs to unveil new tax incentives and programs to businesses](https://www.financedigest.com/do-small-businesses-need-branding.html "Do small businesses need branding?") and individuals, as well as provide insights about the future of the country’s economic health.

Investors can also expect an update from the Office for Budgetary Responsibility (OBR), which has provided its view on public [finances the same day as the budget statement since](https://www.financedigest.com/sentiment-in-uk-finance-falls-at-fastest-pace-since-2019-survey.html "Sentiment in UK finance falls at fastest pace since 2019, survey") its inception in 2010.

Earlier this month, the Bank of England (BOE) forecast the biggest overshoot of its inflation target since being granted autonomy to set [monetary policy](https://www.financedigest.com/asian-economic-powers-warn-of-risks-from-war-monetary-policy-normalisation.html "Asian economic powers warn of risks from war, monetary policy normalisation") in 1997. The BOE now expects inflation to reach its inflation target of 2% by spring of [next year](https://www.financedigest.com/uaes-adnoc-to-open-swiss-trading-office-next-year.html "UAE’s ADNOC to open Swiss trading office next year"), before peaking at 2.8% a year after that. It is then [expected to hold](https://www.financedigest.com/ida-loses-punch-levees-hold-but-louisiana-expects-more-rain-and-flooding.html "Ida loses punch, levees hold, but Louisiana expects more rain and flooding") above 2.5% into 2019.

The BOE is also bracing for weaker [economic growth](https://www.financedigest.com/economic-growth-risks-jolt-inflation-obsessed-markets.html "Economic growth risks jolt inflation-obsessed markets") over the next two years as Brexit negotiations play out. As a result, the [bank said interest rates](https://www.financedigest.com/czech-interest-rates-already-at-high-level-central-bank-governor-says.html "Czech interest rates already at high level, central bank governor says") are likely to fall further before returning to normal.

“There are limits to the extent to which above-target [inflation can be tolerated,” the minutes of the November](https://www.financedigest.com/german-inflation-eased-in-november-but-too-soon-for-all-clear.html "German inflation eased in November but too soon for ‘all-clear’") Monetary Policy Committee (MPC) meeting said.

This is the backdrop that will inform Hammond’s statement [next week](https://www.financedigest.com/hungary-cenbank-seen-hiking-100-bps-to-11-75-next-week-as-inflation-surges.html "Hungary cenbank seen hiking 100 bps to 11.75% next week as inflation surges"). Making matters more difficult for the Chancellor is a new report from the Institute for Fiscal Studies, which said Osborne’s planned surplus of £10.4 billion for 2019-20 was on course to be a £14.9 billion deficit. It bears mentioning that Osborne’s prognostication came before the Brexit vote, which has altered Britain’s reality in profound ways.


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