Rachel Reeves’s tax rises, such as the National Insurance hit on employers, have triggered a £56bn jump in receipts - Krisztian Bocsi/Bloomberg Finance LP The UK borrowed less than expected in December after Rachel Reeves’s tax raid triggered a £56bn jump in receipts. Figures from the Office for National Statistics (ONS) show that the UK borrowing fell to £11.6bn in December, a fall of £7.1bn from a year earlier and below analysts’ expectations. The better-than-expected borrowing figures emerged after p ...

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]

Belgium must act to fix its public finances or risk a market backlash, according to the IMF https://t.co/T6h6Go8OLm ...

Debt Financing - Britain's debt financing premium has decreased [1] - This decrease is attributed to Chancellor Reeves' efforts to strengthen public finances in the recent budget [1] - The central bank's support also contributed to the narrowing of the debt financing premium [1]

A tax reform that is radical, popular, creates good incentives and is likely to improve the health of the public finances for decades to come. What a pity that the British government has had so few of those https://t.co/EvgE9h5STS ...

Equity investors are bracing for one of the most keenly anticipated UK budgets in years, as Chancellor Rachel Reeves looks for an estimated £30 billion ($39 billion) to plug a hole in the public finances and restore fiscal credibility https://t.co/39AF9M9dVL ...

Britain remains on course to borrow billions more than forecast this year, underscoring the perilous state of the public finances https://t.co/L04NoVkdKn ...