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Macro & Markets: Jack-in-the-box on a roller coaster
Market moves have become even more violent, as markets have been faced with fiscal and monetary policies moving rapidly in opposite directions. Bond yields could rise a bit further, but also a correction lower can be swift. “I'm confident that with our growth plan and the upcoming medium-term fiscal plan — with close co-operation with the Bank — our approach will work” – Kwasi Kwarteng, British finance minister on 27 September. What happens when you introduce massive fiscal stimulus into an economy already struggling with overly high inflation? At least chaos in financial markets, if the UK example is of ... (full story)