Chancellor of the Exchequer Rishi Sunak leaves 10 Downing Street after attending a Cabinet meeting on February 14, 2020.
UK Treasury Secretary Rishi Sunak will announce a new emergency package of unemployment curb measures to replace the country's vacation program due to expire next month.
The system subsidized 80% of wages for millions of workers on leave as a result of the pandemic, but Sunak confirmed in July that it would be wound up when the country emerged from lockdown measures, and instead offered companies a loyalty program for employee leave again get to work.
Given that many of these workers were in the hospitality industry and the government is now being forced to reintroduce some restrictions due to a surge in Covid-19 infections, economists have warned the country will face a significant surge in unemployment in the fourth quarter could be quarter.
Earlier this week, Prime Minister Boris Johnson announced a 10 p.m. Pub curfew to curb the spread of the virus. The UK reported 6,178 cases on Wednesday, an increase of 1,252 since Tuesday, and took its total confirmed cases over 412,000.
UK media reports so far suggest that Sunak may announce further wage subsidy initiatives and financial aid, while some have suggested the type of wage increase currently in place in Germany and France may be on the table.
Just last week, the Bank of England gave its first hint that negative interest rates could be considered as it seeks to do its part in propping up the economy against the aftermath of the pandemic, with US GDP rising to a record $ 20. The second quarter fell 4%.
"Financial markets have largely welcomed Chancellor Sunak's speech and sparked a brief spike in trading activity," said Giles Coghlan, HYCM's chief currency analyst.
"This is likely to be short-lived though, and I expect a general retreat to safe havens and cash savings as investors look to hedge against market uncertainties."