Free Trial
USDCAD TECHS

Key Support Remains Exposed

AUDUSD TECHS

Pullback Extends, But Still Looks Corrective in Nature

US TSYS

FED Remains in Play Post-NFP/ISM Data

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access

MNI BRIEF: UK Debt Cost Doubling, Debt/GDP Likely Rising - IFS

(MNI) London

UK debt interest costs are set to be double next year from the level previously assumed by official forecaster the Office for Budget Responsibility and it would require very hefty spending cuts to get the debt/GDP ratio declining, the Institute for Fiscal Studies found in its Green Budget report. The IFS foreshadow the OBR's forecasts, which are set to be published on Oct 31, giving the Bank of England Monetary Policy Committee time to digest them at its November policy meeting,

The IFS forecasts that debt interest payments next year, in the 2023-24 fiscal year, will be GBP102 billion, double the GBP51 billion that the OBR assumed in its March forecast. Borrowing in this fiscal year is expected to come close to GBP200 billion, again double the GBP99 billion assumed by the OBR. If the government's fiscal goal is, as suggested, to get debt/GDP on a declining path five years ahead, then, in the IFS' assessment, based on Citi's macro-forecasts, it would miss this on current plans.

IFS/Citi estimate that GBP62 billion of tightening would be needed in 2026-27 just to stabilize debt and if the health and defence budgets were protected every other departments' budget would have to be cut by 27%.

MNI London Bureau | +44 203-586-2223 | david.robinson@marketnews.com
True
MNI London Bureau | +44 203-586-2223 | david.robinson@marketnews.com
True

To read the full story

Why Subscribe to

MarketNews.com

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.