The FTSE 100 (^FTSE) lagged behind its European peers on Thursday as traders continue to digest the aftermath of Wednesday’s budget announcement. Meanwhile, the pound (GBPUSD=X) traded as high as $1.3268 early on Thursday morning, hitting its highest since 29 October, before retreating again.
It comes amid relief that chancellor Rachel Reeves doubled her headroom to hit her fiscal rule for a balanced current budget in 2029-30, from £9.9bn to almost £22bn. This also pushed down UK borrowing costs on Wednesday.
This is despite the chancellor putting up taxes by £26bn after vowing last year that she would not “come back for more” when raising taxes by £40bn. Labour’s manifesto also promised not to raise taxes on working people.
She admitted she was “asking working people to pay a little bit more” but insisted she had “kept that contribution to an absolute…
