Britain ramped up efforts to calm markets after a heavily criticised budget, with the government bringing forward key economic forecasts and the Bank of England boosting liquidity.
Markets have been spooked by the budget from the government of new Prime Minister Liz TrussLONDON - Britain on Monday ramped up efforts to calm markets after a heavily criticised budget, with the government bringing forward key economic forecasts and the Bank of England boosting liquidity.
It comes after the chancellor of the exchequer was already forced to axe a tax cut for the richest earners, in the face of outrage as millions of Britons face a cost-of-living crisis with UK inflation around 10 percent. The BoE said it was launching a Temporary Expanded Collateral Repo Facility, enabling"banks to help to ease liquidity pressures facing" client funds beyond the end of this week.The central bank has so far made purchases of so-called gilts totalling around £5 billion , far less than its £65-billion limit, under a plan ending Friday.
Fitch last week lowered the outlook on its credit rating for British government debt to negative from stable. "The central bank's action has helped to calm government debt markets but there are concerns about what happens next week after the BoE's support package ends," noted Victoria Scholar, head of investment at Interactive Investor.
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