The City of London is on edge these days. The Telegraph’s International Business Editor, Ambrose Evans Pritchard, writing as a self-described “hard-bitten old Tory,” published a frantic demand on Tuesday that Keir Starmer’s Labor Party stop the “palace coup” underway to bring down him down as Prime Minister. It is the looming full-scale UK financial crisis which has him panicked, not any love of Labor. “The destructive fools of Westminster are needlessly pushing Britain towards a gilts and sterling crisis,” he cried.
From where he sits in the financial world, “a narrative is taking hold that this country is degenerating into an intractable and feral condition… lacking the discipline to see anything through. This is a dangerous reputation to have for a country that is running a large structural trade deficit, needs constant inflows of foreign capital, and has still not expunged the stain of the Liz Truss episode,” he wrote. We remind that the “stain” to which he refers goes back to 2022, when a head of iceberg lettuce famously lasted longer than the 44 days the Conservative Party’s Truss lasted as PM.
“Bond markets have become acutely sensitive to any sign of fiscal slippage anywhere on the planet. They will punish states that stray—even America, with the exorbitant privilege of the dollar,” he continued. He reports that, already, borrowing rates for 10-year British bonds are higher than their U.S., Canadian, Italian, Malaysia or Moroccan equivalents. Moroccan bonds out-performing UK bonds particularly sticks in the craw of this unabashed imperialist ideologue.
