Unruly Britannia

NAB Morning Call

Tuesday 27th September 2022

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The pound fell to an all-time low overnight before picking up a little, but still well down on the day as markets react badly to the new UK Chancellor’s mini-budget last week. NAB’s Taylor Nugent talks through the response, which is being driven largely by uncertainty. Gilt yields have pushed up markedly and the unease has spread to other markets, with bond yields also rising sharply in the US. There has been some expectation that the Bank of England will call an emergency meeting, whilst the Chancellor has said he will provide a fully costed proposal in two months’ time. Will markets settle down without reassurance that the government has its finances under control? Meanwhile, data releases globally were largely softer, including sizeable downgrades to growth forecasts in the latest OECD economic outlook. On the speakers circuit later on, Huw Pill, the Bank of England’s chief economist – perhaps not the easiest gig this time round.

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