TRANSCRIPT 🔗
00:00:00
Speaker 1: Let's go to Vicky Price with the business. Vicky, good morning.
00:00:03
Speaker 2: Good morning.
00:00:04
Speaker 1: Now, what was the reaction to the UK budget last week?
00:00:08
Speaker 2: Well, most people said it was boring. But, of course, what the new Chancellor, John Healey, was trying to do was just keep the markets happy. So the whole budget had the title of breathing space, give breathing space. But, of course, he was talking about breathing space for businesses and the consumers, helping businesses. consumers with a little bit of the cost of living by by lowering various costs that consumers have and businesses by not doing anything major but frankly what he was hoping is to just get a bit of more breathing rooms until this new administration decides what they want to do so there's going to be a spending review next year people are already speculating that there might be an early election because a lot of the things that the new prime minister wants to do he can't do in the current manifesto so there's a lot of uncertainty around but the market so far have allowed rates to stay where they were. Yields haven't moved much and they're giving them.
00:01:00
Speaker 1: The benefit of the doubt. What are we thinking about Lagarde leaving the ECB? I mean, she was going to leave the ECB. It's more just a timing issue. It had been brought forward by nine months or so.
00:01:10
Speaker 2: Yes, I think that's very interesting. Of course, there were already rumours, and it's probably going to be likely the case, that she will go and run the World Economic Forum. But the fact that she announced she was going before the next presidential elections in France is quite important. Because, of course, France needs an awful lot of support right now, given all the protests and the high prices. deficit that they have and the high debt and the fact that the markets are very worried about it. And she said she doesn't want to be necessarily seen as giving preferential treatment to France by assisting them in the next few months.
00:01:41
Speaker 1: But also, there.
00:01:42
Speaker 2: Will probably be a different type of president in the future after the elections in April, which may not be so keen to appoint whoever it is that perhaps those sort of united bodies right now want to replace her. So because her replacement would have come a bit later. So if it is indeed Marine Le Pen, who's right wing, who becomes the president, there may be more difficulty in getting a candidate that everybody's going to accept. So they may decide to replace her a bit earlier because she's leaving earlier. So she's leaving a little bit more flexibility for policy ahead. And that's what she's doing.
00:02:18
Speaker 1: The French don't care because there's debt sellings in Europe, isn't there, to be part of that, to be a member. the French just don't care about the debt ceilings. They just keep busting through them.
00:02:29
Speaker 2: Well, they do care, but they haven't got the type of majority in the National Assembly to be able to do the cuts. So it's a government that can't really function properly. And I think that's the problem. So there are already, of course, in their budget, assumptions that they will cut the spending by something like 56 billion euros. Well, it remains to be seen whether they're able to do it. They may be able to still pass it without having... the National Assembly approving it. But it's all going to be very, very tricky. And Marine Le Pen, if she comes, she will, of course, appoint a new... prime minister and so on. So it will be interesting to see whether there is a move, if you like, to get over that impasse that is there now. But she's got loads of views not supporting Ukraine, for example, and other areas where she wants to see cuts. And somewhere she wants more spending. So it was going to be a pretty, pretty tough time.
00:03:21
Speaker 1: All right. That is Vicky. Good to have you on the show as always, Vicky. Vicky Price, our business correspondent. For more from Early Edition with Ryan Bridge, listen live to News Talk ZB from 5 a.m. weekdays or follow the podcast on iHeartRadio.