Markets Need Clear U.K. Fiscal Policy, Deficit Position: RBS's Davies

The transcript discusses the need for a clear fiscal policy in the UK, especially in light of Brexit and the slowing economy. It highlights the importance of having a fiscal framework to guide government spending and borrowing, as markets are wary of open-ended fiscal expansion without clear priorities. The role of the Chancellor in establishing this framework is emphasized, along with the potential consequences for the economy and currency if such a framework is not implemented.

What was the main issue with the fiscal policy after Philip Hammond?

• It was not clearly defined.

• It was too strict.

• It was too lenient.

• It was not accepted by the markets.

Why are markets open to some fiscal expansion?

• Because the economy is growing rapidly.

• Because interest rates are effective.

• Because there is no need for fiscal policy.

• Because the economy is slowing down.

What concerns do markets have about fiscal expansion?

• It might be too limited.

• It could lead to higher interest rates.

• It could be uncontrolled and indefinite.

• It might not be accepted by the government.

What is the speaker's view on the current Chancellor's understanding of fiscal policy?

• The Chancellor is against fiscal expansion.

• The Chancellor is focused on monetary policy.

• The Chancellor understands the need for a fiscal framework.

• The Chancellor is unaware of fiscal policy needs.

What is the potential consequence of not having a fiscal framework post-Brexit?

• Stronger currency value.

• Weaker currency value.

• Higher interest rates.

• Increased government borrowing.