Soaring Bond Yields Put U.K. Government’s Economic Plan at Risk
Published On Jan 14, 2025, 6:32 AM
Recent trends in the British economy have led to significantly higher yields on government bonds (gilts), reaching levels not seen since 2008. This surge in borrowing costs is raising concerns about the UK government's plans to stimulate the economy through increased public spending and investment. Comparatively, British assets are being viewed less favorably, with the British pound declining against the dollar and equities in London also falling. Analysts suggest that global investors perceive the UK as the weakest link amid rising global bond yields.
Stock Forecasts
EWU
Negative
The continued increase in gilt yields suggests that investor confidence in the UK's economic recovery is waning, which could lead to more downward pressure on UK stocks and bonds. The high debt levels and stubborn inflation further complicate the economic outlook.
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