London, Sept 28 (AFP\/APP): The Bank of England stepped in Wednesday to shore up market confidence after the International Monetary Fund criticized Britain’s inflation-fighting budget.<\/p>\n
Reacting to markets turmoil, the BoE announced it was temporarily buying up long-dated UK government bonds “to restore orderly market conditions”.
\nHowever, the pound promptly slumped 1.7 percent to $1.0552.<\/p>\n
The BoE intervention followed criticism Tuesday from the IMF, which argued that Britain’s budget could increase inequality and worsen inflation.<\/p>\n
Credit ratings agency Moody’s also waded in overnight with a warning about soaring debt.<\/p>\n
Finance minister Kwasi Kwarteng’s big tax cuts and energy price freeze, aimed at boosting the UK’s recession-threatened economy, appeared to have had the opposite effect as traders warn of ballooning debt to pay for the incentives.<\/p>\n
Following last Friday’s budget, UK government bond yields have soared and the pound hit a record low at $1.0350.<\/p>\n
Critics added that Kwarteng’s measures would benefit the rich more than the poorest, as millions of Britons suffer from a cost-of-living crisis.<\/p>\n
“We have acted at speed to protect households and businesses through this winter and the next, following the unprecedented energy price rise,” the
\nTreasury said as it sought to defend itself.<\/p>\n
“We are focused on growing the economy to raise living standards for everyone,” it added.<\/p>\n","protected":false},"excerpt":{"rendered":"
London, Sept 28 (AFP\/APP): The Bank of England stepped in Wednesday to shore up market confidence after the International Monetary Fund criticized Britain’s inflation-fighting budget. Reacting to markets turmoil, the BoE announced it was temporarily buying up long-dated UK government bonds “to restore orderly market […]<\/p>\n
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