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Sat, 26 Sep 2026

Sat, 26 Sep 2026 Faisal Islam: The two big decisions the chancellor must make

He must consider the longevity of Iran war economic pressures and how to sustain modest optimism, writes the BBC's Faisal Islam.

* Faced with conflicting economic pressures: Iran War, inflation, interest rates
* Energy price and yield fluctuations pose significant challenges
* Prolonged conflict or settlement by November's US midterm elections uncertain
* Two options for the chancellor: plan for the worst or buy time with borrowing
* Better consumer and business spirits contrast with need for a "challenging" Budget
* UK economy faces intense competition in bond markets from AI businesses
* IMF warns of spiralling debt costs, urging fiscal consolidation
* Productivity record upgraded by Office for National Statistics, but may not impact OBR's calculations
* Defence Investment Plan and social care system funding to be addressed in the Budget
* Policy announcements will continue to be strategically timed until the Budget