Hammond will keep his powder dry over pre-Brexit windfall | Larry Elliott

The chancellor will adopt a wait-and-see approach to talks before allocating his surplus funds

The largest January budget surplus on record smashed City expectations and was a real surprise given the recent downbeat economic news. But Philip Hammond will take the gift with open arms.

It is now five weeks until the scheduled date for Britain to leave the European Union and while most political and financial market analysts expect the current logjam to be broken, a no-deal outcome remains a possibility.

Related: UK public finances hit record surplus to give Hammond pre-Brexit boost

Hammond is now in a better position than he was when he made his budget speech in late October