In order to prevent the deficit reaching above 6.5 percent this year and 5 percent next year, expenditure must be reduced. There are several ways of achieving that, e.g., cutting public sector wages and/or postponing reductions in tax rates.
It's a pleasure to be with you today and to be part of this discussion on how central banks can support the effective functioning of financial markets.1 Financial stability is essential for a well-functioning economy. A financial system is considered stable when its markets and institutions are resilient and able to function even following a severe shock.