UK markets are speculating on Chancellor's future, fears of looser policy and increased borrowing

From Investing.com: 2025-07-03 04:54:00

UK markets are speculating on the future of Chancellor Rachel Reeves, with fears of looser fiscal policy and increased borrowing. An adjustment to fiscal rules could provide an extra £17bn in wiggle room, potentially avoiding tax rises. Investors remain sensitive to UK’s public finances, with a reluctance to make drastic changes for fear of market reaction. Uncertainties have caused a significant market reaction, with Gilt spreads widening and sterling experiencing a 1% sell-off against the euro. The BoE may intervene if fiscal confidence is not restored, potentially leading to a target of 0.8750 for EUR/GBP.



Read more at Investing.com: What Next After UK Markets Jolted by Doubts Over Chancellor’s Future