UK Chancellor Hunt, hemmed in by debt, set to focus on growth in British budget

Anil Panchal FXStreet

“British Finance Minister (Chancellor) Jeremy Hunt will announce on Wednesday how he will try to speed up the world's sixth-biggest economy after the shocks of Brexit, a heavy COVID-19 hit and double-digit inflation have left it lagging behind its peers,” reported Reuters ahead of a budget speech to the UK parliament at around 12:30 GMT.

The news also mentioned that UK’s Hunt has dismissed calls from other lawmakers in the ruling Conservative Party for big tax cuts now to boost their fortunes before an election expected in 2024.

"In the autumn we took difficult decisions to deliver stability and sound money," Hunt is due to say, according to excerpts of his budget speech. "Today, we deliver the next part of our plan: A budget for growth," he will add reported Reuters.

Key quotes

Hemmed in by his promise to lower the burden of Britain's 2.5 trillion pounds ($3.0 trillion) of debt, Hunt will seek to tackle some of the causes of Britain's long-term economic funk.

Having ruled out a major spending spree or big tax cuts, Hunt will address the acute shortage of candidates for jobs by changing childcare and welfare rules, something he says will help get hundreds of thousands of people back into work.

The Guardian newspaper said Hunt would announce a 4 billion-pound childcare expansion for one and two-year olds in England.

He is also expected to announce measures to improve skills training and give a green light to 12 investment zones.

In an attempt to soften that tax hit, Hunt has hinted at new incentives for business investment.

He is also under pressure from nurses, teachers and other public sector employees who striking for higher pay, while the armed forces say they need more money to support Ukraine in its war with Russia.

GBP/USD stays sidelined

GBP/USD seesaws around 1.2160 during early Wednesday, having reversed from a one-month high the previous day, as traders await the key UK event.

Also read: GBP/USD bulls meet resistance near 1.2200 ahead of UK budget

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

British Pound surges against US Dollar ahead of US NFP data

The British Pound trades 0.5% higher to near 1.3340 against the US Dollar during the European trading session on Thursday. The GBP/USD pair reflects strength as the US Dollar underperforms its peers ahead of the United States Nonfarm Payrolls data for June, which will be published at 12:30 GMT.

EUR/USD climbs above 1.1400 ahead of US NFP

EUR/USD trades in positive territory above 1.1400 in the European session on Thursday, supported by the renewed selling pressure surrounding the US Dollar. Investors await the June employment report from the US, which will feature the critical Nonfarm Payrolls data.

Gold extends recovery toward $4,100 ahead of key US data

Gold (XAU/USD) gathers bullish momentum and rises toward $4,100 in the European session on Thursday. The US Dollar (USD) stays under selling pressure and allows XAU/USD to push higher as market focus shifts to June employment data from the US.

Easing ETF flows and retail demand edge HYPE to make-or-break stage

Hyperliquid price continues to coil, struggling to find direction as it edges higher, after two consecutive days of losses. Institutional demand, a key driver for altcoins in recent times, eases for HYPE with minimal inflows following a $108 million surge last week. Easing retail demand doubles down on HYPE as Open Interest declines 4% in 24 hours.

Nonfarm Payrolls set to grow by over 100K in June, reinforcing bets of upcoming Fed rate hikes

The United States Bureau of Labor Statistics will release the Nonfarm Payrolls data for June on Thursday at 12:30 GMT. Investors expect NFP to rise by 110K following three consecutive months of surprisingly strong increases. Investors are pricing in a hawkish Federal Reserve policy outlook with the new Chairman Kevin Warsh at the helm.

Kevin Warsh offers no policy clues: Why markets still got their answer

Financial markets came to Sintra looking for clues about the Federal Reserve's (Fed) next move. They largely left with confirmation that Fed Chair Kevin Warsh intends to make those clues much harder to find.