Dealers Push Treasury to Sell Bonds at Rock-Bottom Prices
Sunday, April 12, 2009 7:12
This weekend, the economic position of UK was highlighted by the Organisation for Economic Co-operation and Development, which warned of a continuing ’strong slowdown’ in the UK, adding that the recession in UK had yet to hit bottom.
The Government is expected to need to borrow £118bn in the next 12 months in order to meet the soaring cost of unemployment benefits as well as lower takings from taxpayers. As a result, some traders think they have the Chancellor over a barrel now.
Alistair Darling is now facing a confidence crisis in the City with dealers offering ever-lower prices to buy Government bonds. The dealers are pushing the Treasury to accept rock-bottom prices for its bonds as there are only ten days to go before a make-or-break Budget.
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