Okuma Group: Alistair Darlingâ€â„¢s Budget address failed to allay market concerns about Britainâ€â„¢s record deficit.
â€Å“Okuma Group†believes that financial markets focused more on what the UKâ€â„¢s Chancellor of the Exchequer, Alistair Darling, failed to say than what he actually did say during his Budget address.
Investors hoping to hear concrete plans for spending cuts and tax increases were offered what they considered to be half-hearted attempts to appease voters and markets. In response, investors sold sterling on the foreign exchange markets sending the pound to a two-week low against the US dollar. They also sold gilts which forced prices down and yields up.
Analysts at the Asia-based investment broker said that Britain could be facing a debt crisis similar to that afflicting Greece unless plans are put in place to tackle the near 13% of GDP deficit.
â€Å“Okuma Group†speculated that despite the urgent need for clarity on the situation to emerge from government, the impending May 6th general election may not result in a clear victory for either of the two main political parties. Such an event could result in even more wrangling and stalling over the terms of any austerity package.
â€Å“Okuma Group†sources believe that both parties are reluctant to spell out the need for austerity to an electorate that wants to be told that there is a painless solution to the UKâ€â„¢s problems and this may increase the likelihood of a hung parliament.