Branch² Intelligence
The devastating prognosis for the UK’s public finances
Key takeaway
OBR warns UK public finances are unsustainable with debt rising over 50 years.
- Step 1OBR warns UK debt/GDP on unsustainable trajectory over 50 years.
- Step 2Gilt yields rise as investors demand higher term premium for fiscal risk.
- Step 3SME borrowing costs increase as banks pass through higher gilt yields to lending rates.
- Step 4UK SMEs defer investment and hiring, reducing domestic demand.
Source: City A.M.
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