The former Secretary of the Treasury of the United States, Summers, on Thursday criticized the economic policies adopted by the new British Prime Minister, Truss, creating an environment where the pound was below the average with the dollar.
“I’m very sorry, but the UK is acting as an emerging market that is starting to sink,” Summers told Bloomberg Television. “Britain’s exit from the European Union, the Bank of England is behind, and now all this fiscal policy, the UK will be remembered for following the worst macro-economic policy not seen in a large country for a long time. ,” he said.
Big UK tax cuts since 1972, 25.5 trillion yen in 5 years – sell to the pound (1)
The pound fell to its lowest level since 1985 in the foreign exchange market on the 23rd. As of 3:52 pm London time, the pound is trading at $1.0908.
“If the current path is maintained, I would not be surprised if the pound eventually breaks below $1,” he said. “Now is not the time for the kind of naïve, wishful supply-side economics being promoted in the UK,” said Summers. He is also President Emeritus of Harvard University and a contributor to Bloomberg Television.
Summers also said he did not think Japan’s foreign exchange intervention to prop up the Yen was the right approach.
“If you intervene against the trend, if you intervene against the direction of monetary policy, you are just as likely to be effective in changing the course of the currency as it is to be an opportunity in the short term. in Japan.”
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Summers Warns Pound May Flip Past $1 on ‘Naive’ UK Policies (1) (抜粋）