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UK warned ‘utterly irresponsible’ policy could drive pound below dollar and euro parity – business live | Business

Mount Equity Group Tokyo Japan > News > Business > UK warned ‘utterly irresponsible’ policy could drive pound below dollar and euro parity – business live | Business

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Key events (12)UK (14)Kwasi Kwarteng (10)Bank of England (8)US Treasury (4)Bank of Ireland (3)

Deutsche Bank have calculated that the surge in UK 10-year borrowing costs in recent days is the biggest shift in gilt yields since 1976.

That year, Britain turned to the IMF for a loan to prop up the pound, following the inflationary surge caused by the infamous giveaway Barber budget of 1972.

UK 10yr borrowing costs have moved by the most in five days since 1976 when Britain applied to the IMF for a loan. Quite a remarkable chart from Deutsche Bank pic.twitter.com/YYJ0zqxG8k

— Richard Partington (@RJPartington) September 27, 2022

Jim Reid of Deutsche Bank says there have only been four larger moves since 1934, underlining the dramatic volatility created by the mini-budget.

So these are really big moves and continue the rolling VAR shocks of the last 12 months in fixed income.

[VAR measures the riskiness of a bond]

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