Bank of England to launch gentler but still record rate rise after mini budget U-turns October 16, 2022 The Bank of England can marginally take its foot off the accelerator after prime minister Liz Truss U-turned on key aspects of her tax cutting mini budget, but will still launch the biggest move in its 25 years of independence, City economists are betting. The monetary policy committee (MPC) is set to lift borrowing costs [...]
City braces for fresh inflation and borrowing figures October 16, 2022 The City is bracing for another busy week of new data illustrating the health of the UK economy. Last week, the FTSE 100 index fell 1.89 per cent to finish at 6,858.79 points after it was rocked by prime minister Liz Truss ditching chancellor Kwasi Kwarteng. The domestically-focused mid-cap FTSE 250 index, which is more [...]
Analysis: Truss can’t buck the markets October 14, 2022 Around eight minutes is how long prime minister Liz Truss today allocated to explain why she sacked her chancellor for implementing her tax cuts and signed off her second mini budget U-turn. She clarified neither. She answered four questions and committed to her “mission” to boost growth in the UK at a Downing Street press [...]
UK borrowing costs tank as mini budget U-turn rumours gather pace October 14, 2022 UK borrowing costs fell sharply today driven by chancellor Kwasi Kwarteng and prime minister Liz Truss reportedly set to U-turn on more parts of their mini budget. The chancellor has today cut short his trip to the International Monetary Fund’s Washington meetings to hold emergency talks with Truss in London. Rumours of a second U-turn [...]
Investors scramble to dump UK property funds as valuations dive amid widening Kwarteng mini-budget chaos October 13, 2022 Following last week’s bond market turmoil, which sent shockwaves through the City, investors are now scrambling to exit UK property funds. Since the new chancellor, Kwasi Kwarteng, presented his Mini-Budget at the end of September, the pace at which investors are pulling out of UK commercial real estate funds has accelerated. In the 10 days [...]
UK borrowing costs drop as Kwarteng hints at mini budget U-turn October 13, 2022 UK borrowing costs collapsed today driven by chancellor Kwasi Kwarteng sending the strongest signal yet he will roll back elements of last month’s mini budget. Rates on UK gilts dropped across the curve after they yesterday climbed to their highest level since the day the Bank was forced to step in. Yields on the 30-year [...]
City braced for end of £65bn Bank of England bond market package October 13, 2022 The City is bracing for the Bank of England to pull its £65bn emergency support package for the bond market tomorrow, but experts said volatility could be tamed by existing backstops supporting the pensions industry. Britain’s debt market has been rocked by concerns over the government’s financial credibility after it launched £43bn of tax cuts [...]
London’s FTSE 100 bags gains as rate sensitive stocks kick higher October 13, 2022 London’s FTSE 100 notched gains yesterday driven by stocks exposed to interest rates receiving a boost from reports the government will roll back some of the mini-budget. The capital’s premier index jumped 0.35 per cent to 6,850.27 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK [...]
US inflation tops expectations in sign Federal Reserve has more work to do October 13, 2022 US inflation climbed higher than expected on a monthly basis in September in a sign the Federal Reserve’s series of steep rate hikes are failing to tame the toughest price pressures. Inflation hit 0.4 per cent last month, above Wall Street’s expectations of a 0.2 per cent increase and higher than August’s print, figures from [...]
The Inflation Game: War, Peace and the Perils of Central Banking October 13, 2022 | City Talk The descent is always more sudden than the increase; a balloon that has been punctured does not deflate in an orderly way. — John Kenneth Galbraith I travelled with my family to London and Normandy in July 2022. Our primary purpose was to meet up in France with my father-in-law, who had dreamed of visiting the [...]