Capital Economy, Business and Finance
Rachel Reeves’s decision to travel to China for trade talks during a week of turmoil for the UK’s bond markets risked looking blasé. At least the chancellor didn’t return empty handed.
Reeves signed investment deals worth £600 million over five years and loosened trade barriers for UK food exporters who have been suffering since Brexit. That won’t, however, play well with the incoming US president.
Nor will it allay fears in the Treasury that a big rethink on spending will be needed to reassure jittery debt holders. Further cuts to disability welfare and a “hotel tax” are both reportedly under consideration as ways to make up for some of the spending buffer being nearly wiped out last week after government borrowing costs reached their highest since 2008.
In a Brompton bicycle showroom in Beijing, Reeves said her self-imposed fiscal rules were “non-negotiable” and promised new plans to stimulate growth in the coming weeks.
