Pimco, one of the world’s biggest bond funds, have followed up their decision to cut back on UK gilts by publicly deriding Labour’s existing deficit reduction plans. If Gordon Brown sticks to his plans, Pimco think there is an 80 per cent chance of a downgrade.
The irony of this is of course that Ed Balls’ brother Andrew (another fine former FT journalist) is currently in charge of managing Pimco’s European portfolio.
George Osborne just put it rather well in the Commons, saying the Pimco move “suggests that a lack of confidence in the chancellor’s abilities runs right across the Balls family”.
Jim Pickard
Kiran Stacey