Chancellor takes final chance for pre-election giveaway

This week has been all about politics. The US presidential primary season ended as Nikki Haley withdrew from the Republican contest. With no official challenger to Joe Biden among the Democrats, it is now a two horse race between Biden and Donald Trump to the election in November. Meanwhile, China’s biggest annual political event, the National People’s Congress, also concluded this week. The congress brought confirmation that China’s target for annual GDP growth will remain at 5%. However, there were no new policies designed to meet the ambitious growth target.

In the UK, Jeremy Hunt used the budget for a few pre-election sweeteners. Under pressure from backbenchers to come up with a tax cut or two, the chancellor opted for another cut to national insurance. Not only can be it be presented as pro-growth and rewarding work, it is also cheaper than cutting income tax. The government will be relieved that the economic outlook has improved slightly but all in all it was a low key budget. There was nothing to move markets and the government will need more than a small NI cut or 0.1% increase in GDP to turn its fortunes around.

For the following stories, please click on this link*

  • UK: Markets steady as Government increases borrowing to fund tax cuts
  • Rates: ECB on hold as US Fed remains cool on timing of first cuts
  • Equities: Big Tech facing more regulatory headwinds

(*Please note, The contents of this e-shot been prepared for general information only. It does not contain all of the information which an investor may require in order to make an investment decision. If you are unsure whether this is a suitable investment you should speak to your financial adviser. This information is not guaranteed to be correct, complete, or accurate. FE Research is a division of Financial Express Investments Ltd, registration number 03110696, which is authorised and regulated by the Financial Conduct Authority (FRN 209967). For our full disclaimer please visit www.financialexpress.net/uk/disclaimer. Data Sourced from FE Analytics, and Bloomberg Finance LP.)

Recommended Posts