GDP growth ‘way down’ in markets’ pecking order of economic indicators: DSP Mutual Fund’s Sandeep Yadav

11:08 PM ETDeveloping

Business Desk

In Short: The UK Chancellor will detail plans to spread economic growth across the country through a new £150 million fund aimed at fast-growing northern firms.

The Treasury hopes the fund will attract additional private capital, as part of the Chancellor's vision of an "active state" working with private businesses to create opportunity. "The next chapter of Britain's growth story will be written in more places," the Chancellor is expected to say, adding that No 10 North was set up to "remove obstacles" and red tape.

However, the plan comes against a challenging economic backdrop, with a leap in government borrowing costs amid concerns about the inflationary impact of the Iran war threatening the Chancellor's fiscal headroom. The Chancellor will also task the British Business Bank and National Wealth Fund with doing more to support investment and innovation across the UK.

The National Wealth Fund has agreed strategic partnerships with mayoral authorities in South Yorkshire, Liverpool City Region, and the North East, as well as Cardiff Capital Region. "This is not sentimentality, it's supply side economics," the Chancellor is expected to say, adding that the fund will help to spread growth more widely across the UK.

In a related development, according to reports, the GDP growth rate ranks "way down" in financial markets' pecking order of economic indicators, with inflation, government finances, and geopolitics all seen as more important. "The good times are behind us" as far as foreign investment in Indian government debt is concerned, according to Sandeep Yadav, Head of Fixed Income at DSP Mutual Fund.

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This will give local leaders direct access to the fund’s investment expertise to help develop infrastructure projects, the Treasury said.
The Chancellor will unveil a £150 million fund for fast-growing northern firms as he sets out plans to grow the economy through an “active” state.
“This is not sentimentality, it’s supply side economics.” The pot, using money already allocated to the Government-owned bank, will offer investments of between £5 million and £15 million to help university spin-outs and other innovative companies across the North of England expand.
And he will say that growth will help Britain navigate that turmoil with “an optimistic story – one of resilience, pride, huge latent potential”.
In the 25 years that I’ve been in the markets, there have been so many times that I have felt this is something we have never seen before.
Edited excerpts: GDP data has continuously exceeded expectations for several quarters, but markets aren’t really reacting to it.
I think it’s way down in the order right now, especially for the debt market.

Sources

The Indian Expresslink