THE Bank of England has issued a warning that Britain faces a financial crisis that would see households battling against much higher borrowing costs and soaring prices – as the direct result of the US-Israel’s imperialist war on Iran.
Policymakers have already pointed out that the US-Israel war has already ‘left an extra million people facing higher mortgage repayments after banks began increasing their rates’.
Roughly 5.2 million borrowers now face higher payments by 2028 said the Bank of England yesterday. This is up from 3.9 million before the conflict with Iran began.
The Bank’s Financial Policy Committee which monitors financial stability, commented that Donald Trump’s war on Iran had unleashed a new bout of volatility across the economy.
The Bank’s Financial Policy Committee warned in the minutes of its latest meeting that hedge funds ‘had been forced to unwind about £19bn of bets on interest rate cuts as the prospect of lower borrowing costs evaporated after the outbreak of war’.
Trump and Netanyahu’s war in the Middle East has effectively shut the Strait of Hormuz through which about a fifth of all oil and gas exports normally passes.
This has pushed up energy prices and produced warnings that a global recession and crash is on the way!
The Bank of England has warned that ‘a sharp correction in equity markets could provide an additional channel through which stress could transmute to gilt markets’.
The UK is expected to spend more than £100bn this year on debt interest, slashing the cash available to spend on vital public services such as the NHS.
The FPC (Financial Policy Committee) said that: ‘The continuing conflict has worsened the outlook for sovereign debt through its potential to weigh down on growth, raise interest rates and increase pressures on spending.
‘This will constrain the government’s capacity to respond to future shocks and worsen vulnerabilities in the sovereign debt markets.’
It also said that the £13.5tn private credit market posed heightened risks to financial stability, with some funds already restricting withdrawals to try to stop a panicking rush to the exit!
The Prime Minister Keir Starmer tried to say yesterday that Britain was well placed to weather the storm from the Middle East ‘disruption’. He added: ‘I know that people have a deep sense that this will affect their family and their household.
‘They can see it at the petrol pumps and they worry about their energy bills.
‘It is the job of government to meet these moments, not just with immediate action but also with clarity about our direction!’
Workers are, however, determined that they will not be driven back to the wages, conditions and the absolute poverty that faced the working class in the 1930s.
In fact, the UK working class has massive power and now needs to use that power by forcing the TUC to call a general strike to bring down the Starmer government and bring in a workers government and socialism.
A Special TUC Congress must be convened at once to organise the working class and the youth to call a general strike to bring down the Starmer regime and replace it with a workers government and socialism.
British and world capitalism is completely bankrupt. It must be dumped into the ‘dustbin of history’ by the victory of the British Socialist Revolution.
There is not a moment to lose as far as the working class and the youth of the world are concerned. Capitalism can only offer a future of mass wars and counter-revolutionary pogroms!
Build sections of the International Committee of the Fourth International worldwide to complete the victory of the World Socialist Revolution!
