After the bizarre days of chaos in Westminster, Boris Johnson has announced his resignation as Tory party leader, but he wants to remain in office as British Prime Minister until the autumn.
This can not go well.
Politically, it would be hara-kiri for the Conservatives to allow a long stalemate until the party conference in October.
And it increases economic uncertainty.
The impression of a government stuck like a sinking, disoriented ship is poison for economic sentiment.
Consumer confidence on the island has already plummeted due to inflation.
The rate of inflation, driven by energy bills, is likely to accelerate and reach double digits.
Added to this is the effect of rising taxes and social security contributions.
In this situation, many eyes and expectations are turning to the new finance minister, Nadhim Zahawi, whom Johnson appointed on Tuesday night but who then publicly turned against him.
Zahawi has hinted that there could be tax cuts with him soon.
Nothing is off the table, he says.
His predecessor, Rishi Sunak, was skeptical that a tax cut that boosts consumer demand would fuel inflation and then trigger a sharper central bank response with higher interest rates.
It would be a risk to start a more expansive fiscal policy now.
But the big question is whether Zahawi currently has the political power in the paralyzed Johnson government to initiate a change of course.
Will he remain Treasury secretary if Johnson leaves?
Will he even become interim prime minister?
As long as this is not clarified, the future direction of fiscal and economic policy will remain in the balance.
And with that, the uncertainty continues for companies who do not know, for example, whether the corporate tax increase from 19 to 25 percent will come as announced next April.
In such a situation, investors initially hold back.
The political instability threatens to further weigh on the economy.
An extremely bad starting position if a new head of government has to try to get the ship back on the road at Downing Street.