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Last Friday, Bloomberg issued the first "new wave" covid alert, targeting the UK, and writing that "after 19 months spent attempting to ward off Covid-19 while safeguarding jobs and businesses, the U.K. is heading into winter with a growing problem: The coronavirus is spreading rapidly, just as the economy starts going in the opposite direction."

According to the report, "U.K. cases are accelerating faster than in other western European nations, while deaths have jumped to their highest since March." And while UK government ministers are having to deny they are planning for a new lockdown, "at the same time, economic growth is slowing, inflation is running high, the Bank of England is expected to hike rates soon and households are facing a cost-of-living crisis."

In short, a new wave of covid - whether real or imagined - is about to be unleashed on the UK at the worst possible time, just as the BOE may be about to hike rates in a matter of weeks to offset the UK's soaring inflation with 5Y breakevens hitting the highest level this century.