Finance Minister Enoch Godongwana will this week outline improvements in South Africa’s public finances that pave the way for a sovereign credit-rating outlook upgrade, a Bloomberg survey shows https://t.co/zrp4RwbLFB ...

South Africa’s upcoming budget must deliver on debt targets to preserve confidence in public finances, says the IMF https://t.co/LoA22T9G31 ...

Ireland should save more of its windfall from corporate taxes to shore up public finances, the country's central bank chief says https://t.co/MbeGBQqFXT ...

Prime Minister Sebastien Lecornu survived another attempt to oust him over his plans for France’s public finances, bringing the country a step closer to securing a 2026 budget https://t.co/4SQN2rDoZD ...

Saudi Arabia is widening its search for capital, turning to some of the kingdom’s wealthiest families as the government looks to ease pressure on public finances https://t.co/nkP8kSnmyz ...

Core Insights - The UK experienced a £56 billion increase in tax receipts due to recent tax rises implemented by Rachel Reeves, leading to lower-than-expected borrowing figures in December [1][2][4] Group 1: Tax Receipts and Borrowing - UK borrowing fell to £11.6 billion in December, a decrease of £7.1 billion from the previous year and below analysts' expectations [1] - Tax receipts increased by 7.6%, with a total rise of £33.2 billion from April to December, largely driven by higher income tax receipts which contributed £16.6 billion [2][3] - The National Insurance increase on employers contributed £23.8 billion to tax receipts during the same period, bringing the total tax take close to £150 billion [2] Group 2: Public Finances and Debt - Despite the positive borrowing figures, public finances are described as fragile, with national debt at its highest level since the early 1960s, at 95.5% of GDP [5][6] - Borrowing from April to December was £4.1 billion lower than forecast, primarily due to lower-than-expected debt interest costs, which were £3.8 billion less than anticipated [4] Group 3: Economic Outlook and Risks - Analysts express concerns that borrowing may exceed forecasts by the end of the financial year, with potential political instability posing risks to fiscal responsibility [7][8] - High borrowing costs and rising interest rates are significant challenges for public finances, with interest costs accounting for £9.1 billion of the net government borrowing in December [9][10]

Core Viewpoint - The U.S. Treasury, under Secretary Scott Bessent, is focused on keeping bond yields low, particularly for the benchmark 10-year bond, which influences government deficits and borrowing costs for households and corporations [2][12]. Group 1: Treasury Yields and Market Reactions - Treasury yields are seen as a barometer for the success of the Treasury's efforts to manage borrowing costs, which have decreased across the curve [1]. - The "term premium" for holding U.S. debt has started to rise, indicating investor concerns about the high U.S. deficit and debt levels [3]. - Following the announcement of potential long-term debt sales, benchmark 10-year bond yields spiked over 6 basis points, marking one of the largest increases in recent months [6]. Group 2: Investor Sentiment and Administration Actions - Investors are concerned about the U.S. federal deficit, which has led to fears of upward pressure on long-dated bond yields [5]. - The Treasury has engaged with investors to gauge market reactions to major decisions, indicating a proactive approach to managing investor sentiment [9]. - The administration's messaging and actions have led some investors to believe that it is serious about controlling yields, resulting in a reduction of short positions against long-dated Treasury bonds [8][19]. Group 3: Economic Context and Future Outlook - The U.S. economy's resilience, bolstered by AI-led spending, is helping to offset growth drags from tariffs, contributing to the current stability in the bond market [16]. - The Treasury's reliance on short-term borrowing through Treasury bills is seen as a strategy to manage the deficit without increasing long-dated bond supply [21]. - Analysts predict that the supply of U.S. government debt with maturities longer than one year will decline next year, despite a stable budget deficit [22]. Group 4: Risks and Market Dynamics - The bond market's current stability is described as a "tenuous balance" that could be disrupted by rising inflation or a hawkish Federal Reserve stance [24][25]. - The volatility of demand sources, such as stablecoins, poses risks to the Treasury's funding strategy [25]. - Historical patterns show that bond markets can punish governments for fiscal irresponsibility, which remains a concern for the current administration [13].

Bank of Finland Governor Olli Rehn called on the Nordic country’s government to decide on more measures to fix its ailing public finances https://t.co/EY2HwQKErm ...

In 2019, France watched a national treasure go up in flames. Now, there's a fear that the structures holding up French politics are starting to catch. There is clearly a problem with French public finances.Further worsening of the budget deficit. France's political crisis deepened today. Most French citizens adore their nation's system of social safety nets, but those programs have become increasingly unsustainable.France has the Euro area's largest deficit, massive debt, and every attempt at reform has end ...

Public Finance & Market Risk - France faces potential market backlash if deficit reduction plans fail to bring it within 5% of economic output next year [1]