to the bbc news at one. the bank of england has made a fresh move to try to calm investors, saying it will buy more government bonds after warning of a material risk on the markets to financial stability. uk bonds are also known as gilts, and they allow the government to raise money by borrowing from investors. the bank s move is part of its emergency scheme which started after last month s mini budget, when the government s plan for large tax cuts without explaining how they would be paid for spooked the markets and drove up borrowing costs. those costs rose sharply again yesterday after the bank said the scheme would end this week. downing street said this lunchtime that liz truss remains committed to the measures in the mini budget. here s our business correspondent, ben king, with more. another ben king, with more. day of chaos on the market amid another day of chaos on the market amid the after shocks of the mini budget. sharp rises in the interest rate on gilts have forced pensio
3ist forward a compelling case on the 31st of october or not. one of the interesting things about the ifs report is they caution against, for instance, cutting investment. if you do that, it might reduced debt but it will reduce growth. so there are a number of difficult trade offs that the government will face. it is not clear they will be successful in making them, to be honest. what the ifs report underlined is that they do face a tricky situation at the moment. to do face a tricky situation at the moment. ., . ~ . , , do face a tricky situation at the moment. ., ., ,, ., , , . ,, moment. to take a step back, the re ort of moment. to take a step back, the report of a moment. to take a step back, the report of a material moment. to take a step back, the report of a material risk moment. to take a step back, the report of a material risk to - report of a material risk to financial markets, how unusual is it to hear a description like that? it is unusual and it is sort of thing t
this is bbc news. the headlines at 11am: another intervention from the bank of england as it steps in to stabilise markets it s warning of a material risk to financial stability. the unemployment rate in the uk is at its lowest level for almost 50 years, according to figures released this morning. air raid sirens have gone off again across ukraine, a day after russia launched some of the worst attacks there for months. the head of the british intelligence agency, gchq, will say in a speech today that russian forces in ukraine are exhausted. a hearing is under way as to whether scotland can call an independence referendum without the consent of
with the biggest tax cuts in half a century led to havoc on currency markets, more importantly on debt markets, and then within days, led to a tidal wave of interest rate rises reaching every corner of the economy. in an emergency statement, the bank of england said, were dysfunction in this market to continue or worsen, there would be a material risk to uk financial stability. it said it was seeking to restore market functioning and reduce any risks from contagion to credit conditions to uk households and businesses. this explains the intervention. since the mini budget, the effective cost of borrowing long term for the government has shot up and was spiralling above 5%, a 20 year high. these were rises in two days that would normally take years, increasing the cost of borrowing for the government and everybody. the bank of england intervened today, buying up those debts
last week s widely criticised mini budget unveiled by the chancellor has been followed by a collapse in the pound and a sharp increase in the costs of government borrowing. our economics editor faisal islam has the latest. what started as an attempt to grow the economy with the biggest tax cuts in half a century led to havoc on currency markets, more importantly on debt markets, and then within days, led to a tidal wave of interest rate rises reaching every corner of the economy. in an emergency statement, the bank of england said, were dysfunction in this market to continue or worsen, there would be a material risk to uk financial stability. it said it was seeking to restore market functioning and reduce any risks from contagion to credit conditions for uk households and businesses. this explains the intervention. since the mini budget, the effective cost of borrowing long term for the government has shot up and was spiralling above 5% a 20 year high.