BlackRock’s UK chief investment strategist, Vivek Paul, has warned this week that pre-election promises of large tax cuts or spending increases could unsettle the bond markets again. There are clear echoes here of the turmoil that followed the Truss/Kwarteng mini-Budget back in 2022. But how worried should we be? These warnings should not be dismissed … Continue reading How much should we fear the return of the ‘bond vigilantes’?
Tag: inflation
‘Economic Overview’ (presentation)
In case of wider interest, here are the slides from a presentation I made yesterday to the Shadow Monetary Policy Committee, hosted by the IEA. The SMPC is a group of independent economists whose purpose is to monitor the decisions of the Bank of England’s official Monetary Policy Committee and to make policy recommendations of … Continue reading ‘Economic Overview’ (presentation)
Rate cuts are coming, but the markets may have to force the Bank’s hand
The Bank of England’s decision to leave interest rates on hold this week was no surprise. However, there is still little sign that policymakers are thinking of cutting rates any time soon, despite stagnant growth and falling inflation. Indeed, three of the nine members of the Monetary Policy Committee (MPC) voted again for another quarter … Continue reading Rate cuts are coming, but the markets may have to force the Bank’s hand
Give Rishi Sunak a little credit for hitting his inflation target – but not a lot
In January the Prime Minister outlined his five priorities for 2023. The first pledge was to “halve inflation this year to ease the cost of living and give people financial security.” The other targets are more challenging, but this one at least has now been met. This is because the CPI measure of inflation fell … Continue reading Give Rishi Sunak a little credit for hitting his inflation target – but not a lot
Plain-speaking Economics 