UK's Healey spares markets drama, but budget not entirely leak-free
TLT•UK Finance Minister John Healey’s budget left government bonds little changed, with borrowing plans close to dealers’ forecasts. A report that bank taxes would rise less than feared moved bank shares before Healey spoke.
1. Markets stay calm
British government bonds ended Wednesday little changed after Healey’s budget offered help to households and motorists facing higher global energy costs while raising taxes on banks. Borrowing for the current financial year was £112 billion, matching the forecast in a dealers’ poll, while planned bond issuance for 2026/27 was £250.6 billion, £1 billion above consensus.
2. Bank tax plans leaked
The budget was not entirely leak-free: a report that bank taxes would rise less than feared boosted bank shares before Healey’s statement. Parliament’s Treasury Committee chair Meg Hillier asked the finance ministry and the Financial Conduct Authority to investigate what happened and confirm banks had not received advance details.
3. Tighter preparations
Healey’s team used restricted groups of officials and upgraded Treasury IT systems to protect policy details, according to a person familiar with preparations. The calmer market reaction contrasted with the run-up to the previous year’s budget, which saw bond-market jitters after plans to raise income taxes appeared to change and a fiscal forecast was accidentally made available online before the statement.
