This Part of the U.K. Market Is Glossing Over a Spending Problem

All roads lead to fiscal loosening in the U.K. and the gilt market is too complacent about the risks to the public finances.

The upside deficit risks associated with the Conservative Party’s proposed tax cuts and spending increases, as well as the chance of a left-wing government led by Labour’s Jeremy Corbyn, still have room to be priced into U.K. bond markets.