The UK is at risk of a deep recession next year, according to the world’s biggest active bond fund manager.
Pimco’s chief investment officer Daniel Ivascyn warned that the firm is making larger-than-usual bets on British government bonds compared to the United States, as it expects the UK economy to struggle in 2024.
This comes as the UK struggles with interest rates at a 15-year high of 5.25%, while the Bank of England expects growth to be flat.
“In the UK’s case, a deeper economic downturn is only more likely because it is a small, open economy and consumers feel the impact of central bank policy much more strongly than in the US. ” Ivascyn told the Financial. times.
“We believe there is potentially more risk of a hard landing.”
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what happened overnight
Tokyo stock markets closed higher as the yen weakened against the dollar as the Bank of Japan maintained its ultra-easy monetary policy.
The benchmark Nikkei 225 index rose 1.4%, or 460.41 points, to 33,219.39, while the broader Topix index rose 0.7%, or 16.95 points, to end at 2,333.81.
Japanese markets traded cautiously to take losses ahead of the Bank of Japan’s policy decision, after weeks of swirling speculation that government officials would break away from tight controls on negative interest rates and bond yields as inflation accelerates. It started covering.
The Nikkei average rose in afternoon trading after the central bank announced during the midday trading break that it would stick to easy monetary policy. Following this announcement, the yen depreciated against the dollar.
Asian stocks were mixed elsewhere as Wall Street’s seven-week winning streak slowed.
Sydney’s S&P/ASX 200 rose 0.8% to 7,486.90, while South Korea’s Kospi was little changed at 2,566.30.
Hong Kong’s Hang Seng Index fell 0.6% to 16,527.75, and the Shanghai Composite Index fell less than 1 point to 2,930.18.
Bangkok’s SET was also little changed, while Taiwan’s TaiEx was down 0.7%.
The Dow Jones Industrial Average, which is made up of 30 major US companies, ended almost flat at $37,306.02. The broader S&P 500 index rose 0.5% to 4,740.56, and the technology-heavy Nasdaq Composite Index rose 0.6% to 14,904.81.
Retailers and big technology companies were among the biggest gainers. Amazon.com rose 2.7% and Etsy rose 4.7%, the biggest gain among S&P 500 stocks. Chipmaker Nvidia rose 2.4%, Meta rose 2.9% and Netflix ended up 3%.
The yield on the benchmark 10-year U.S. Treasury note rose 1.5 basis points to 3.943% from 3.928% late Friday.