Two days to the Budget, and the data turned up first. Inflation 3.5%. Unemployment 4.7%. Consumer confidence minus 24, the steepest fall since the 2016 referendum. National debt past £3 trillion. And the typical full-time salary past £40,000 for the first time. Every one of those numbers will be on the Chancellor's desk on Wednesday; this edition is what they mean for yours. Grab your Monday coffee.
The Big Story: the numbers the Chancellor walks in with
Budgets are written weeks in advance, but the numbers that frame them arrive in the final fortnight, and this fortnight's were almost all worse than expected. Here is the in-tray, with the source on every line.
The number | Figure | Why it matters on Wednesday |
|---|---|---|
Inflation, September | 3.5% (from 3.1%) | Highest in almost a year; fuel up 30% on the year. Every benefit uprated in April uses this number, and so does the state pension's inflation leg |
UK Borrowing, September | £24.5bn | £1.7bn more than a year ago and £6.0bn over the OBR's path for the year so far (£97.8bn) |
National debt | Over £3 trillion, 94% of GDP | First time past £3tn. Interest on it is the fastest-growing line in the accounts |
Fiscal headroom | £12bn (from £24bn) | Resolution Foundation's estimate of the Chancellor's margin against his own rules, halved by the oil shock; it wants £8bn of tax rises to rebuild it |
Consumer confidence, October | -24 (down 11 points) | Biggest fall outside Covid since July 2016. The major-purchase index fell 14 points |
Unemployment | 4.7% (from 4.9%) | The one good number, but vacancies are at a five-year low and total pay growth the weakest in nearly six years |
ONS (20, 21 and 22 October 2026); Resolution Foundation (13 October 2026); GfK/NIQ (23 October 2026).
Source: ONS, GFK, Resolution Foundation, TMB
The board, updated
Last week we sorted the rumours into three piles. One line has moved and one has firmed:
Ruled out: CGT rising to income-tax rates (Treasury via FT); scrapping stamp duty (Prime Minister, July); and now, reportedly, cutting the "mansion tax" threshold from £2 million to £1.5 million (FT via PensionBee, 13 October). The £2 million annual charge from April 2028 stays as legislated: £2,500 a year on homes worth £2m to £2.5m, rising to £7,500 above £5m.
As good as in: a bank tax, most likely the surcharge back from 3% towards 8%, worth about £2 billion a year. Bank shares fell again this week "amid concerns over potential tax increases in next week's budget" (Trading Economics market report, 23 October).
Still open: the personal allowance and frozen thresholds; the pension tax-free lump sum; fuel duty's scheduled 3p rise in January; and the shape of winter energy support beyond the VAT cut on electricity already announced.
Source: HMRC, HM Treasury, PensionBee, TMB
What the think tanks are asking for
The Resolution Foundation's chief economist James Smith wants a Budget that "doesn't push everything off into the never never": around £8 billion of tax rises, from a 2p switch between employee National Insurance and income tax (which would reach landlords, the self-employed and pensioners with taxable income, about £6 billion), closing CGT exemptions on death and on leaving the UK (about £4 billion), and National Insurance on partnership income (about £2 billion). It also wants energy support aimed at households where nobody earns over £24,000 (Resolution Foundation via Yahoo Finance, 13 October). The IMF's line from a fortnight ago still stands behind all of it: support "targeted and temporary", and "rebuilding fiscal space is urgent".
The one US sentence: oil, not Washington, is the foreign driver this week. Brent closed at $116.72 on Friday, a four-year high, on the prospect of renewed US strikes on Iran and attacks on Saudi facilities (Trading Economics, 23 October), and that is the single biggest reason UK inflation is 3.5% rather than falling.
What it means for you. Three things to hold until Wednesday. First, the April 2027 uprating of benefits and the state pension is normally set by September's inflation, so 3.5% is the number most of it will use; for the state pension the triple lock takes the higher of that, earnings growth (which the ONS says is the weakest in nearly six years on the total-pay measure the lock uses) and 2.5%, so the exact figure is one to read from the Budget documents, not the speech. Second, if your money question is "will they touch X", the honest answer for the allowance, ISAs and the lump sum is still "nobody outside the Treasury knows", and the only safe date is 12:30 on Wednesday. Third, read next Monday's brief before you act on anything you hear on Wednesday afternoon: the detail is in the OBR tables, not the speech.
Sources: Office for National Statistics (20, 21, 22 October 2026); Resolution Foundation via Yahoo Finance (13 October 2026); GfK/NIQ (23 October 2026); Financial Times via PensionBee (13 October 2026); City AM (16 October 2026); Trading Economics (23 October 2026); IMF World Economic Outlook (13 October 2026).
Rates & Mortgages: BoE hike to 4% in November, and. amarket that already priced it in
The Bank of England meets on Thursday 5 November, eight days after the Budget, and the market has made up its mind:
A quarter-point rise to 4.00% is priced at 94 to 95% (overnight index swaps via Money to the Masses, 21 October). A Reuters poll found 54 of 63 economists expect it; Goldman Sachs moved to forecasting it after the inflation print.
After that, the market and the economists disagree. Markets price at least three more quarter-point rises by April 2027 (Trading Economics, 23 October); the Reuters poll found no majority for any rise beyond November, with 30 of 61 expecting one more in early 2027. Bank of America's Sonali Punhani: "The bigger pickup in inflation is still ahead of us rather than behind us."
The Bank's own view is that inflation reaches about 3.75% this quarter and a little over 4% in early 2027. In September three of nine committee members already voted for 4%.
Source: Money to the Masses, Rightmove, Nationwide, Trading Economics
A base rate rise, explained once: the Bank of England sets the rate it pays banks, and everything else is priced off it. A fixed mortgage does not move; a tracker moves the day the Bank does; a standard variable rate moves when the lender chooses. On our standard £250,000 over 25 years, a quarter-point rise is about £38 a month more on a tracker (5.50% to 5.75%: £1,535 to £1,573). Fixed rates, which follow gilt yields rather than the base rate, have already made most of their move: Rightmove puts the average two-year fix at 5.55%, from 5.29% a month ago, which it says adds about £250 a month to a typical new mortgage compared with earlier this year (Rightmove via Money to the Masses, 20 October). The HSBC and NatWest cuts we reported last week have not been followed by the averages.
For savers, the same week brought the clearest sign yet of the rise being passed on: Nationwide raised its fixed bonds and ISAs on Friday to 4.75% for one year, 4.85% two, 4.90% three and 5.00% for five (Nationwide, 23 October). In August its one-year bond paid 4.25%.
The housing market: 3,000 price cuts a day
Three housing reports this week, and they tell one story: sellers are moving on price before buyers move at all.
Rightmove, October: average asking price of newly listed homes £371,015, up 1.0% on the month but 0.1% below a year ago. London up 2.5% in the month and still 1.7% below a year ago, with 38% of its listings cut. North East -2.0%, Scotland -1.9%, North West -0.6%, Wales -0.3% on the month. New listings +3% on the year, buyer enquiries -9%.
Rightmove, September: the busiest month for asking-price reductions since 2011, more than 3,000 listings a day, typical cut 7%, almost £21,000. Homes priced right from day one found a buyer in 39 days; homes that later needed a cut took 119. Nearly three-quarters of homes sold this year needed no cut at all.
ONS, August: average UK price £273,000, up 0.9% on the year, the fourth month of slowing; London the weakest English region, on falling flat prices. Wales £216,000 (+3.1%), Scotland £198,000 (+2.9%), Northern Ireland £202,000 (+9.2%). Rents £1,406 a month, up 3.8%.
Rightmove's Colleen Babcock: "Homes that look overpriced can stand out very quickly," and "it's much better to avoid needing [a reduction] in the first place." Zoopla found a quarter of homes newly listed in September had been on the market in the previous 12 months, and six in ten of those came back cheaper (via Money to the Masses, 20 October).
What it means for you. If you are selling, the 39-versus-119-days line is the one to take to your agent: the Rightmove data says the price you start at matters more than the price you end at. If you are buying, a 7% typical reduction and a market that has been waiting for Wednesday both say the same thing about where the leverage sits this month, though a rate rise on 5 November is the counterweight. If your fix ends in the next six months, the cuts we reported last week were the exception and the averages are the rule; the lock-in window and the stress test from #26 still apply.
Sources: Money to the Masses (21 October 2026); Reuters poll (15 October 2026); Trading Economics (23 October 2026); Bank of England (18 September 2026); Rightmove via Money to the Masses (20 October 2026); Nationwide Building Society (23 October 2026); Office for National Statistics, UK House Price Index and Private Rental Prices (22 October 2026); Zoopla via Money to the Masses (20 October 2026).
Markets & Pensions: the Money Brief Market Spotlight
Our regular Spotlight: the big markets across four timeframes, because the timeframe you choose decides the story you tell. Figures are as at Friday's close. "This year" means since the first trading day of January; "5 years" is rolling, the same week five years earlier. Oil and the pound keep their seats.
Market | Now | Past 1 month | This year (since Jan) | 5 years (rolling) |
|---|---|---|---|---|
FTSE 100 (UK) | 10,690 | +0.1% | +7.4% | +47.7% |
S&P 500 (US) | 7,624 | -1.0% | +11.2% | +65.5% |
Gold ($/oz) | $3,994 | -6.6% | -7.8% | +124.0% |
Silver ($/oz) | $53.88 | -15.6% | -24.4% | +125.9% |
Brent oil ($/bbl) | $116.72 | +9.5% | +92.1% | +39.4% |
UK 10-yr gilt (yield) | 5.37% | -0.02pp | +0.86pp | +4.32pp |
Bitcoin | $80,750* | -3.9% | -9.0% | +31.2% |
Guest: £1 buys (US dollars) | $1.338 | -1.2% | -0.9% | -2.2% |
Guest: £1 buys (euros) | €1.194 | +2.8% | +4.0% | +0.9% |
*Bitcoin at time of writing, Saturday; it trades through the weekend. Gilt moves are in percentage points (pp), not percent. Euro row is the inverse of the euro-pound rate.
Three lines deserve a sentence. The FTSE gave back 2% of last week's 3% jump, with banks down on Budget-tax worries and the gold miners down as gold slipped below $4,000 for the first time since July; the oil majors went the other way, Shell up 3.5% and BP 4% on Friday alone. Brent at $116.72 is a four-year high and the "this year" column now reads +92%, which is the whole inflation story in one cell. And the pound is at €1.194, its best this year, for a reason that is not flattering: investors have been moving out of eurozone bonds on debt and unrest worries, and UK gilts, at 5.37%, are the beneficiary (Trading Economics, 23 October).
Source: Trading Economics, TMB
The world this week, briefly
In the US, the week was oil and AI again: Tesla cut its spending forecast on Thursday, which revived doubts about the scale of data-centre investment, and the Nasdaq fell 2.6% that day before steadying; the Federal Reserve decides on rates this Wednesday, the same day as our Budget, with the hotter US inflation print making a rise more likely than a cut. The read-across for a UK reader is the same as last week: a global tracker is two-thirds American, and the AI names are a third of that.
The pension angle
If the Bank raises rates to 4% on 5 November, two things happen to pensions. Annuity rates (the guaranteed income for life an insurer pays for a pot) are already at an 18-year high on 5%+ gilts, and a base-rate rise tends to hold them there. And the bond-heavy "lifestyle" funds that default schemes move you into before retirement have had a poor year, because when yields rise, the price of the bonds already held falls. Same number, two directions, depending on whether you are about to buy income or are still holding bonds.
What it means for you. As always with the Spotlight: a picture, not a nudge, and past performance guarantees nothing.
Sources: Trading Economics (23 October 2026); CryptoTicker (23 October 2026) for the Tesla and Nasdaq line; Bank of England.
Crypto Corner: $2.71 trillion, and a $1 billion week for the ETF’s that still ended in outflow
A month ago the whole crypto market was worth $2.91 trillion. On Saturday it was $2.71 trillion, 7% smaller, after a 3.65% fall in the last 24 hours alone (TokenPost, 24 October). The week in the numbers that matter beyond the Bitcoin price:
Measure | Figure | What it tells you |
|---|---|---|
Total market cap | $2.71tn, from $2.75tn a week ago and $2.91tn a month ago | A third straight week of shrinkage; about $200bn gone in a month |
24-hour trading volume | $62.5bn | Down from the $71bn we quoted a fortnight ago: fewer people trading |
Bitcoin's share of the market | 59.5% | Unchanged: Bitcoin and the rest fell together this week |
Bitcoin range this week | High above $84,800 on Wednesday, low about $80,400 on Saturday | The push above $84,000 did not hold |
Forced liquidations, Friday and Saturday | About $431m Thursday night into Friday (CoinGlass), $441m into Saturday, 88% of it "long" bets | Borrowed money sold to meet margin calls, for the third week running |
US spot Bitcoin ETF flows, Monday to Thursday | +$443m net (Mon +$527m, Tue +$23m, Wed +$528m, Thu -$636m) | Two big days in, then the largest single-day outflow since June on Thursday; October to date -$175m |
TokenPost (24 October 2026, 21:06 UTC); CoinGlass via CryptoTicker (23 October 2026); Farside Investors via TFTC (to 22 October 2026; Friday's flow not published at time of writing).
The pattern is now three weeks old: the market is being moved by US rates and US technology stocks, not by anything in crypto. Thursday's $636 million ETF outflow came on the day the Nasdaq fell 2.6% on Tesla's spending cut, and the forced selling followed overnight. CryptoTicker's line is the one to keep: "A liquidation is not a decision to sell." It is a decision made for you by the lender, and every one pushes the price onto the next threshold.
The rest of the board
Coin | Price (Sat) | Past week | Past month | This year |
|---|---|---|---|---|
Bitcoin | $80,750 | -0.8% | -3.9% | -7.7% |
Ethereum | $2,378 | -1.0% | -11.6% | -19.9% |
Solana | $102 | -0.8% | -16.0% | -17.6% |
XRP | $1.29 | -0.2% | -17.8% | -29.9% |
BNB | $740 | +3.1% | -4.8% | -14.5% |
Cardano | $0.21 | -3.7% | -18.2% | -36.5% |
Trading Economics crypto board, Saturday 24 October 2026. "This year" on this board is measured from 31 December, so Bitcoin reads -7.7% here and -9.0% in the Spotlight, which starts from the first trading day of January.
The UK angle. Nothing in the Budget rumours touches crypto directly. The one line to watch on Wednesday is capital gains tax, because for a UK holder a disposal of crypto is a CGT event like a share sale: the £3,000 annual exemption and the 18% and 24% rates in last week's One Thing To Know apply to it in full.
Crypto assets are high-risk and largely unregulated in the UK. Values are extremely volatile. You could lose all the money you invest. This is not investment advice. Never invest more than you can afford to lose. |
Sources: TokenPost (24 October 2026); CryptoTicker (23 October 2026); Farside Investors via TFTC (22 October 2026); Trading Economics (24 October 2026); HMRC, Cryptoassets Manual.
Economy & Cost of Living: the average salary passed £40,000; here is where it goes
The ONS published its annual pay survey on Thursday. The median full-time salary, the one in the middle of everyone working full time, was £40,911 in April, up 4.5% on the year, the first time it has been over £40,000. Weekly pay was £811.20, up 5.8%, and after inflation full-time pay rose 2.7% in real terms (ONS, 22 October). That is the good news, and it is real. The rest of this section is what happens to it.
Source: ONS, HMRC, Employee Earnings Report, TMB
From £40,911 to your bank account
Line | A year | A month |
|---|---|---|
Median full-time salary | £40,911 | £3,409 |
Income tax (20% above the £12,570 allowance) | -£5,668 | -£472 |
National Insurance (8% above £12,570) | -£2,267 | -£189 |
Take-home, before pension or student loan | £32,976 | £2,748 |
Our arithmetic on 2026/27 rates and thresholds, England, Wales and Northern Ireland; Scottish bands differ. A workplace pension at the minimum 5% employee contribution and a Plan 2 student loan would take a further £145 and £95 a month respectively.
Now the line that is in the Budget rumours. The £12,570 personal allowance has been frozen since April 2021, and the freeze is already legislated to 2031. Prices have risen 31% since it was fixed (ONS CPI index, April 2021 to September 2026). Had the allowance kept pace it would be about £16,450 today, and someone on the median salary would pay around £780 a year less income tax. That is the "stealth tax": nothing in the rate changes, the threshold stands still, and inflation does the work. The Chancellor can end the freeze on Wednesday, extend it, or leave it; all three are still possible.
What the £2,748 a month meets
Rent: £1,406 a month, the UK average for a private tenant, up 3.8% on the year (ONS, 22 October). Just over half of the median take-home.
Energy: £143.58 a month under the current cap, with January's forecasts running from £166.58 to £179.33 (Cornwall Insight, Bank of England, MoneySavingExpert, as tabled in #26). Ofgem confirms on 25 November.
Fuel: petrol 169.5p a litre and diesel 192.5p in September, up 8p and 11p on the month and 30% on the year (ONS, 21 October). On a 1,000-mile month at 40mpg, that is about £190 of petrol, roughly £45 more than a year ago.
Food and the rest: goods inflation 3.2%, services 3.7%, and the Resolution Foundation's five-year figure from #26 still stands: prices nearly 30% above July 2021, a typical working-age household £2,900 a year worse off than if inflation had run at 2%.
The mood, in one number
GfK's consumer confidence index fell 11 points to -24 in October, with every one of its five measures down. The two biggest falls were in what people expect of the economy over the next year (down 14 to -36) and in whether now is a good time to make a major purchase (down 14 to -22). Only Covid has produced a bigger one-month fall; the last one this size followed the referendum result in July 2016. GfK's Neil Bellamy: "There has been an extraordinary collapse in consumer confidence in October," and "the speed of this deterioration is alarming" (GfK/NIQ, 23 October; fieldwork 1 to 14 October). Retail sales for September, published Friday, fell 0.4% on the month, worse than expected (ONS, 24 October). The optimism the pollsters measured after the summer change of Prime Minister has, on these numbers, gone.
Jobs, in two lines
Unemployment fell to 4.7% in the three months to August, the lowest in a year, and September's payroll count rose by about 13,000 after months of falls. Against that, vacancies fell 21,000 to 691,000, a five-year low, with the ONS saying the fall is "concentrated mainly within smaller businesses, which cite increased labour costs as a key factor", and total pay growth including bonuses is the weakest in nearly six years (ONS, 20 October).
What it means for you. The pay rise is real and bigger than inflation for most full-time workers; the tax on it is the line to watch on Wednesday, and the bills it meets are set by oil and the energy cap more than by anything in the speech. If money is tight now, the help is free and not a last resort: StepChange and Citizens Advice for debt and arrears, MoneyHelper for the numbers, the Warm Home Discount and the Priority Services Register for winter energy, and your supplier's hardship fund.
Sources: Office for National Statistics, Employee earnings in the UK (22 October 2026); ONS Consumer price inflation (21 October 2026); ONS Private rent and house prices (22 October 2026); ONS Labour market overview (20 October 2026); ONS Retail sales (24 October 2026); GfK/NIQ (23 October 2026); HMRC rates and thresholds 2026/27; Resolution Foundation (8 October 2026); Ofgem; Cornwall Insight; Bank of England; MoneySavingExpert.
One Thing to Know: how to read a government budget
At 12:30 on Wednesday the Chancellor stands up; by 13:30 the Office for Budget Responsibility (the OBR, the independent body that checks the government's sums) publishes the tables; by 14:00 every outlet has a "what it means for you" piece. Most of those pieces will be wrong in a small way by Friday, because the speech is the headline and the tables are the law. Four things decide what a Budget actually costs you, and none of them is the number in the headline.
1. The date it starts
A measure announced on Wednesday might take effect that day (duties usually do), next April (most tax changes), April 2028 (the £2 million property charge already is), or 2030 (the state pension change the Prime Minister has floated). The further away the date, the more likely it is to change before it arrives, and the more time you have. Last year's stamp duty change was announced in October and took effect the following April, and the gap produced a rush to complete. When you hear a number, find the date.
2. Thresholds against rates
A Budget can raise your tax without touching a single rate, by leaving the thresholds where they are while pay and prices rise. That is how a £12,570 allowance fixed in 2021 is worth about £780 a year less to a median earner today than it was then. Freezes are quiet; rate rises are loud. Listen for the word "maintained", which is Treasury for frozen.
3. "No plans" against "ruled out"
In the fortnight before a Budget, the Treasury answers every rumour with "decisions on tax are a matter for the Chancellor at fiscal events", which rules out nothing. "No plans" is a notch stronger and has been reversed before. "Ruled out", from the Prime Minister or Chancellor in their own words, is the only one that holds, and even that has a shelf life of one Budget. On our board, only two lines have that status: CGT alignment and scrapping stamp duty.
4. The verdict comes from the bond market, not the benches
Thirty minutes after the speech, the OBR's forecast shows whether the sums add up, and the gilt market says what it thinks: yields falling means lenders believe it, rising means they do not. In September 2022 the market's verdict arrived within the hour, and mortgage rates followed within days. The 10-year gilt closes Wednesday at a number, and that number will reach fixed mortgage rates by the following week whatever the Chancellor said.
Your six lines for Wednesday
Keep this open during the speech. These are the lines that touch household money, and the question to ask of each:
Line | Where it stands now | The question |
|---|---|---|
Personal allowance and tax bands | £12,570, frozen to 2031 | Freeze extended, ended, or allowance raised? From which April? |
Savings allowances and ISAs | PSA £1,000/£500/£0; ISA £20,000; cash ISA to £12,000 for under-65s from April 2027 | Any change to the PSA, the ISA limit or the cash ISA cut? |
Capital gains tax | £3,000 exemption; 18% and 24%; alignment ruled out | Rates nudged? Exemptions on death or on leaving the UK closed? |
Property | Stamp duty bands as in #26; £2m annual charge from April 2028 | Any band change, and from when? Anything for landlords? |
Fuel duty | Frozen since 2011; 3p rise due January, 2p in March | Does the January rise go ahead with petrol at 170p? |
Energy support | VAT off electricity already announced; cap £1,723, January forecasts +16% to +25% | Who qualifies, how much, and for how long? "Targeted and temporary" means means-tested and time-limited |
Current positions from HMRC, HM Treasury, PensionBee's Budget preview (13 October 2026) and our #26 and #27 editions. Nothing in the right-hand column is a prediction.
Why it matters to you. Wednesday will produce a hundred headlines and about six facts that change your money. The four tests above sort one from the other, and the table is the six places to look. Next Monday's brief will be the Budget edition: every line above, filled in from the OBR tables rather than the speech, with the dates attached.
Sources: HM Treasury; Office for Budget Responsibility; HMRC rates and allowances 2026/27; PensionBee (13 October 2026); Bank of England; Office for National Statistics.
Before you go…
That is your five minutes on the week before the Budget.
If someone you know is earning around £40,000, forward them the salary section: the £780 is the number they will not hear on Wednesday. If they are about to list a house, the 39-versus-119-days line is the one to send.
The diary
Wednesday 28 October, 12:30: the Budget. OBR forecast at 13:30; the gilt market's verdict by the close. The US Federal Reserve decides on rates the same evening.
Thursday 5 November: the Bank of England, 4% priced at 95%.
Thursday 13 November: third-quarter GDP.
Wednesday 18 November: October inflation.
Tuesday 25 November: Ofgem confirms January's energy cap.
Monday 15 December: Ofwat's final decision on the £240 million.
Look after your money. It is on your side more than you think.
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Thank you,
Ellis
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