the Blog rss Title underline

The 2020 Public Services Trust Blog

Thursday, December 10, 2009

Borrow more, borrow now…

By Ashish Prashar

There was very little change in the borrowing figures in yesterday’s Pre-Budget Report, which is impressive given the turmoil of the last year. The Treasury also estimated that the cost of bailing out the two state-backed banks will now only cost £10bn and £50bn as previously estimated and the Chancellor promised the markets that the deficit would be halved in four years. However, he ducked the decisions on where cuts would need to be made and spending for 2010-11 will surge ahead as planned.

Now although deficits look bad it has been relatively cheap to borrow since the start of the recession and we’re probably now entering the beginning of a period where the rate for government to borrow will normalise as the recession comes to an end, therefore becoming more expensive.

So if government going to go forward with spending as planned and borrow more in the near future, it’s probably a good idea to borrow now and lock it in while rates are low.

Bookmark and Share
Tags: , , , , , ,
Posted by Ashish Prashar at 11:10 am
Divider bar

1 Comment »

  1. [...] This post was Twitted by 2020PST [...]

    Pingback by Twitted by 2020PST — December 10, 2009 @ 11:16 am

RSS feed for comments on this post. TrackBack URL

Divider bar

Leave a comment

divider

To subscribe to email updates of this blog, enter your email address below:

Delivered by FeedBurner

  • Recent posts
  • Archive