- Bank Of England Must Do A “Large” Emergency Rate Hike To Avoid Total Disaster, DB Warns
by Tyler Durden, https://www.zerohedge.com/
On the one hand, the Bank of England just hike rates by 50bps, reupped its warning of a recession, and warned that it will have to be much tighter for a long time to come. On the other, in an apparent complete failure in communication, the Truss government and its motley crew of cartoonish officials just cut taxes by the most in almost 50 years, a tax cut which will be funded with more debt. No wonder cable is plunging, gilts are imploding and global markets are cratering on fears that the “UK model” will soon be adopted by the rest of the world (just as Albert Edwards accurately predicted just yesterday).
So what is to be done to avoid a complete disaster? Well, according to DB FX guru George Saravelos, it’s time for central banks to panic, and to put ridiculous governments in their place. Specifically, the strategist writes in a note (available to pro subs) that “a large, inter-meeting rate hike from the Bank of England as soon as next week to regain credibility with the market.”