Britain’s sketchy growth plan is scarier than its bond wars

Expansive and costly economic policy of the new UK Prime Minister Liz Truss revived fears about “bond watchers.” But the turmoil in financial markets may have more to do with the plan’s opaque return on investment than its usury requirements.

On Monday, the British pound fell record low against the US dollar in overnight trading before rising slightly again. Investors had expected Ms Truss’ new government to spend £150 billion, or $163 billion, to freeze energy bills, but on Friday, her CFO, Kwasi Kwarteng, which combines this with the most sweeping tax cuts since 1972, according to the independent Institute for Fiscal Studies, as well as totem measures like removing bankers’ bonus limits. The total package will be worth £291 billion, or 12.6% of the colossal gross domestic product, over the next five years, according to estimates by the UBS economist Anna Titareva.

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