Investors show lukewarm confidence in Chancellor Reeves as fiscal challenges mount

'Compromises will need to be made'

Almost two months into her tenure, Chancellor Rachel Reeves is facing growing challenges to fix the UK’s fiscal problems, with investors arguing the tasks ahead appear “daunting”.

Since taking charge of the country's finances, Reeves has promised to "fix the foundations of Britain's economy" and told investors abroad that the country is "open for business". The move aims to bolster trust in the markets and economy, which have been damaged by Brexit, the Covid-19 pandemic and the cost-of-living crisis. However, Labour officials have said a £22bn fiscal hole is also pushing the government to consider raising taxes and cutting public spending to stabilise the economic deficit. In the run up to the new government's budget on 30 October, Prime Minister Keir Starm...