Market Extra: Pound climbs, gilt yields fall again on expectations U.K.’s Kwarteng will speed up debt-cutting plans

by | Oct 4, 2022 | Stock Market

The British pound rose and gilt yields fell a second day after reports that U.K. Chancellor Kwasi Kwarteng will publish debt-reducing plans early, a day after a U-turn over widely criticized tax cuts for the wealthy. The pound
rose 0.5% to $1.1378, bringing the currency well above the $1.12 level seen ahead of the Sept. 23 budget announcement that sent the currency crashing, yields soaring and sparked a global financial rout. The yield on the 10-year gilt yield
was 6 basis points lower at 3.896%.

Kwarteng plans to publish details on how to bring down the U.K. budget in October after previously saying he would wait until Nov. 23, according to the Financial Times, the BBC and other U.K publications. Markets saw a similar reaction on Monday after the U.K. government said it would can plans to scrap the highest tax rate, cancelling one of the key components of a debt-funded budget that had roiled financial markets. The pound was also rising against the backdrop of a falling dollar
as investors piled into perceived riskier assets such as equities, with U.S. stock futures


pointing to another day of strong gains. The Dow Jones Industrial Average
saw its best session since June on Monday after weaker-than-expected manufact …

Article Attribution | Read More at Article Source

Share This