It is recalled that the new figures for public finances have been created by the decision by Mr Kwarteng and Liz Truss to make tax cuts of £43 billion
By Thanasis Gavou
The Bank of England has again warned of a “material risk to the UK’s financial stability” and a “dysfunction” in part of the pensions market, despite its intervention last month by launching an emergency government bond purchase.
The new warning reflects concerns that the cost of government borrowing for the UK continued to rise on Monday.
The rise in government bond yields came despite the Central Bank’s announcement that it could double the value of government bonds it will buy and that it will extend support to pension funds.
This treaty led to the announcement of an expansion of the emergency bond purchase program, as the Bank will now also buy inflation-linked government securities.
At the same time, the prestigious Institute for Fiscal Studies (IFS) warned that the Truss government’s mini-budget, which has sparked concern about public finances, has raised the specter of a major financial “black hole”.
Specifically, in order for Finance Minister Kwasi Kwarteng to stabilize or reduce public debt, as he has pledged to do, the Institute estimates that spending cuts and/or tax increases of £62bn will be needed.
It is recalled that the new figures for the public finances have been created by the decision of Mr Kwarteng and Liz Truss to make tax cuts of £43 billion and to simultaneously grant anti-energy precision support packages of £210 billion.
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I have worked in the news industry for over 10 years and have been an author at News Bulletin 247 for the past 5 years. I mostly cover technology news and enjoy writing about the latest gadgets and devices. I am also a huge fan of music and enjoy attending live concerts whenever possible.
