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• We at Fitch

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• We at Fitch Solutions now expect that the Bank of England (BoE) will lift its benchmark Bank Rate to its pre-pandemic level of 0.75% over the course of 2022, after beginning its tightening cycle in December 2021 with a 15 basis-point (bps) hike to 0.25%.
• We anticipate that inflation will average 4.5% in 2022, ending the year well

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• We at Fitch Solutions expect further tense rhetoric between the UK and the EU over the Northern Ireland Protocol in the coming days, which the UK government refuses to implement in full on the grounds that it substantially disrupts trade within the UK.
• However, we believe the UK will eventually compromise on its demands, meaning both

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• We currently expect the UK's residential building industry to see real growth of 12.1% y-o-y in 2021, and average annual real growth of 4.7% y-o-y between 2021 and 2025, though we note growing downside risk from the demand-side of the industry, and the broader macroeconomic environment, that could serve to dampen this outlook.
• The

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• We continue to expect Prime Minister Boris Johnson to serve out the rest of its term to 2024 following a major cabinet reshuffle designed to boost the ruling Conservative Party’s popularity.
• Risks of a rebellion against the government remain low, despite some divisions on tax hikes announced in September and enduring obstacles to

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• At Fitch Solutions, we believe that the UK's current account deficit will widen to 3.8% in 2021 from 3.5% in 2020 as a recovery-induced increase in imports outpaces growth in exports.
• The current account deficit should begin narrowing from 2022, coming in at 3.4% of GDP in 2022 and 3.3% in 2023 according to our forecasts, largely on

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• At Fitch Solutions, we believe that the British high street will come increasingly under pressure over the coming years, despite the Covid-19 pandemic fading.
• The key driver behind our view is the rise of e-commerce across the UK. E-commerce sales remain well above pre-pandemic levels despite easing restrictions and the country's

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• We forecast the United Kingdom's construction industry to see real growth of 11.8% y-o-y during 2021, as robust demand across its major sub-sectors and broad economic benefits of comprehensive Covid-19 vaccine coverage fuel near-term growth.
• Infrastructure and residential building activity continue to perform particularly strongly

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• The new Innovative Medicines Fund will support the launch of rare disease medicines in the UK pharmaceutical market and provide additional revenues to drugmakers.
• The fund will operate in a similar fashion to the Cancer Drugs Fund meaning a potentially lower barrier for clinical evidence and faster cost-effectiveness evaluation.
• Des

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• We forecast real household spending growth in the UK to begin to recover in 2021. Our forecast for real household spending growth in 2021 is 5.4% y-o-y. We note that this growth is from a low base following the estimated 10.6% y-o-y contraction in real household spending growth over 2020.
• In 2022, we forecast real household spending