State of Play. 16 January 2025

What a difference a day makes. On Tuesday, a chorus of commentators, some less than impartial, declared the UK’s economic situation a crisis, piling pressure on the Chancellor. By Wednesday morning, UK inflation had dropped to a steady 2.5%, and US inflation data later in the day proved similarly benign. The result? A sharp rally in the gilt market and a growing consensus that the Bank of England (BoE) will cut interest rates in a fortnight.

Santander Asset Management digs deeper in this week's State of Play.