Who Benefits from the Chancellor’s New Fiscal Policy?

In a landmark speech Philip Hammond confirmed the Government’s new economic direction. What might this mean long-term for different sectors of the UK stock market?

Cherry Reynard 10 October, 2016 | 12:34PM

Chancellor Philip Hammond’s speech at the Conservative Party Conference last week confirmed a change in economic direction. Although he continued to talk of fiscal consolidation, there was a loosening of the purse strings for infrastructure development and housebuilding projects, and he reiterated that he would not target a budget surplus by the end of this Parliament.

The early reaction in markets has been difficult to discern amid the ‘flash crash’ of sterling and the concern surrounding the increasingly likelihood of a hard Brexit. Stock markets have continued to climb higher, but more on currency factors. What might the longer-term hold? 

In turning his attention towards fiscal policy as a tool for boosting the UK economy, Chancellor Hammond is following the Japanese government, which recently announced a ¥28.1 trillion ($276 billion) stimulus package. This is also being targeted at infrastructure spending, though some will also go to local councils.

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

To view this article, become a Morningstar Basic member.

Register For Free

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

About Author

Cherry Reynard

Cherry Reynard  is a financial journalist writing for Morningstar.co.uk.

Audience Confirmation


By clicking 'accept' I acknowledge that this website uses cookies and other technologies to tailor my experience and understand how I and other visitors use our site. See 'Cookie Consent' for more detail.

  • Other Morningstar Websites
© Copyright 2021 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Cookies       Modern Slavery Statement