Shadow Chancellor Mel Stride has requested that the UK’s financial regulator, the Financial Conduct Authority (FCA), investigate potential “market abuse” by Treasury and Downing Street officials prior to the recent Budget announcement. This inquiry follows Chancellor Rachel Reeves’ denial of misleading the public regarding the nation’s financial health, despite newly revealed information suggesting that the financial situation was better than previously believed. Critics, including Conservative Party members, have called for Reeves’ resignation due to concerns about the accuracy of her assessments.
In his communication to the FCA, Stride expressed that sensitive market information might have been misused, contributing to volatility in financial markets, impacting businesses and families. The FCA’s responsibilities include investigating allegations of market misconduct, such as insider trading or manipulation.
Stride’s concerns center on briefings related to the economic context leading up to the Budget, suggesting that inaccurate portrayals were influenced by political motives. He noted that Treasury leaks contributed to market speculation.
The FCA has acknowledged receipt of Stride’s letter and is expected to respond. Market reactions are being closely monitored due to their implications for government borrowing costs, which are influenced by the perceived credibility of the Chancellor’s financial management.
Following Reeves’ Budget proposals, which included tax increases and the lifting of a benefit cap, government borrowing costs slightly decreased, indicating some confidence in the measures. However, accusations of a misleading public narrative regarding the state of finances remain a focal point of critique.
The Scottish National Party (SNP) has also joined the Conservatives in urging an FCA investigation into the allegations of misleading briefings. Reports suggested that Reeves faced a significant gap in meeting tax and spending rules, raising further questions about her declarations. In response, Reeves defended her actions, clarifying the context of her fiscal strategy and asserting a commitment to improving the budget’s resilience.
Source: https://www.bbc.com/news/articles/c1kpjwee3g7o?at_medium=RSS&at_campaign=rss