Mohamed El-Erian, chief economic adviser at Allianz, says the Chancellor has to strike the right balance to reassure the markets and help the economy grow.
He’s been telling BBC Radio 4’s Today programme, that the markets are looking for confirmation that the UK is restoring its economic reputation, putting government finances on a sound footing and promoting economic growth.
“It is going to be tricky, striking the right balance because there are so many economic and political judgments here,” Dr El-Erian says.
Large tax rises and spending cuts could be seen as “excessive austerity”, he adds, while measures to boost economic growth are absolutely critical.
“The answer to all the issues that the UK faces today from inflatio… to a damaged economic reputation, is high, sustained, inclusive growth,” Dr El-Erian says.
Source: BBC