UK government suffers blow in bond market
The UK government has today suffered a severe blow after Bill Gross, the co-founder of bond fund giant Pimco, suggested that the UK was "a must avoid" for investors. To add further insult to injury he also claimed that the UK was "resting on a bed of nitroglycerine" due to the massive debt racked up over the last couple of years.
This comes on the day the UK economy officially moved out of recession with a disappointing 0.1% growth in the final quarter of 2009. Despite a more general upbeat feel to the UK economy over the last few months it would appear that many investors are still very wary of investing in the UK because of the growing budget deficit and the shaky nature of the so-called economic upturn. So will this impact upon the UK economy in the short to medium term?
In many ways it seems to be one step forward and two steps back with the UK economy at the moment and there are concerns that, economic performance aside, we could in fact "talk ourselves" back into recession. Consumer and business confidence are vital elements of any potentially economic upturn but as we have seen over the last few months, business leaders and consumers can be very fickle in their short-term outlooks.
Share this..
Related stories
Gordon Brown confirms government backing for HBOS and Lloyds TSB merger
Gordon Brown has today repeated the UK governments backing of the Lloyds TSB and HBOS merger even in the face of rumoured offers from elsewhere. In a sharp put down to the Scottish suggestion of a new management team to take control of HBOS he concluded that the Lloyds bid should be allowed to go through in the absence of another "serious" bidder.
This is a sharp reality check for o...
MPs expenses investigation in disarray
The investigation into MPs expenses is in disarray after more than 80 MPs fought payback demands from Sir Thomas Legg leaving 200 MPs to pay back under £1 million in total. The very fact that the investigation into MPs expenses will cost more than £1 million leaves this sorry saga on the verge of a farce. So what has gone wrong? A number of MPs have taken legal action to reduce their payments...
Read MoreUK government in profit on banking stakes
The UK government today stands with a profit of around £3.4 billion on investment stakes in Royal Bank of Scotland and Lloyds bank. After reporting profits of around £1.6 billion the Lloyds bank share price has increased to 74p giving the UK government a net gain of £3.17 billion on its initial £17 billion investment. As we await Friday's figures from Royal Bank of Scotland the government curr...
Read MoreMortgage lending 'hits new low'
Home loans lending for purchase hit a decade-long low in May, new figures from the British Bankers' Association (BBA) show.The mortgage approvals were found to have fallen 20 per cent to just 28,000 - the lowest monthly total since records began in 1997.This total is also 56 per cent down on May 2007's figure, which was registered before the beginning of the credit crunch last summer.Elsewhere in...
Read MoreUS Treasury prices recover slightly
As the US government comes to the end of a $101 billion bond auction traders are breathing a sigh of relief after the last $26 billion auction went relatively well. Despite the fact that yesterday saw a significant fall in Treasury prices across the board, there was something of a recovery today even though many analysts have grave fears about the state of the US economy.
While ther...