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Foreward - The Chancellor's Trilemma

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  • David aikman

Abstract

The UK economy enters the second half of 2025 still confronting weak growth and stubborn inflationary pressures. While external factors – including continued trade policy uncertainty and persistent geopolitical risks – certainly matter, domestic challenges dominate the outlook. Chief among these is the Government's increasingly acute fiscal predicament. Simply put, the Chancellor cannot simultaneously meet her fiscal rules, fulfil spending commitments, and uphold manifesto promises to avoid tax rises for working people. At least one of these will need to be dropped – she faces an impossible trilemma.

Suggested Citation

  • David aikman, 2025. "Foreward - The Chancellor's Trilemma," National Institute UK Economic Outlook, National Institute of Economic and Social Research, issue 19, pages 1-3.
    • Handle: RePEc:nsr:niesra:i:19y:2025p:3
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