Last week, The British government launched the largest tax cut policy in 50 in three years, hoping to boost the domestic downturn economy. , the tax cut measures "ignited" the British financial market, causing the pound to fall below the 1.04 mark against the US dollar, and the British bond market experienced a "selling wave" and the domestic stock market fell sharply.
US media reported that since took office, the cumulative losses of the UK stock market and foreign exchange market exceeded 5,000 000 00 million US dollars. Currently, the large-scale tax cut plan launched by the British government will undoubtedly increase the fiscal deficit and may exacerbate the UK's inflation level. Data shows that the UK's CPI still rose 9.9% year-on-year in August.
However, the more serious situation is the emergence of "financial dominance", and investors' confidence in the UK economy will decline. And what comes along is that they believe that the possibility of the Bank of England's sharp hike of rate is likely to be pulled up by tax cuts. The market for was once expected that the Bank of England may raise interest rates by 11html by the end of March 3150 basis points.
In addition, due to the "crazy" turmoil in the bond market, the price of British Treasury bonds has been lowered, which makes the British pension funds that hold a large amount of Treasury bonds currently face certain "bankruptcy" risks. In order to avoid the "collapse" of the bond market, the Bank of England officially launched the 300 million pound bond purchase plan on 928 on March 3.
plan data shows that this plan will be implemented from September 28 to October 14, during which the Bank of England will enter the secondary market for 5 billion pounds each time to purchase some long-term British Treasury bonds. In addition, was originally scheduled to start selling 838000 million pounds of treasury bonds next week, and it has been temporarily delayed until the end of March by 10html.
Bank of England said they will push the order of financial markets back to normal at the most urgent speed. However, they also warned that if the market for continues to fluctuate significantly without control, the UK may face significant financial risks. htmlOn the 427th, IMF issued a statement stating that the British government's tax cuts were too inappropriate.
text | Zheng Hongjie Title | Huang Zixin Review | Zeng Yi
