Capital Economy, Business and Finance
Putting Brexit and Liz Truss’s mini-budget behind them, investors are moving money into UK bonds as political uncertainty upsets European and American markets, according to French research group Amundi. Investors are looking forward to moderation and stability from Keir Starmer’s new Labour government and seeing its gilts and the pound as safe haven assets. This is largely driven by relative instability in France and the US. Macron’s snap election gamble seems to have blown up in his face with the far-right Rassemblement National expected to emerge the largest party in Sunday’s election. In Washington, Joe Biden is scrambling to hold on to his candidacy after his disastrous debate performance last week. That said, the UK’s fiscal future isn’t certain either. Given their campaign promises, the IFS expects a £10 to £20 billion black hole in Labour’s spending plans by the end of Starmer’s first term.
