国际英语新闻：UK unlikely to suffer debt crisis, pound crisis: HSBC currency strategist Paul Mackel

LONDON, March 15 (Xinhua) -- The UK is unlikely to suffer a debt crisis and pound crisis, said Paul Mackel, Director of Currency Strategy, HSBC.

He told Xinhua in a recent interview that the levels of debt in the UK are very high and also very high on a number of other countries right now. "So it is hard to become very concerned about the situation in the UK. Fiscal concerns are evident in many of the major economies at the moment," he said.

Greece-style debt crisis unlikely in UK

As predicted by the Treasury, the public deficit would reach a record high 178 billion pounds (about 270 billion U.S. dollars) in the 2010-2011 fiscal year, equal to more than 12 percent of the UK 's gross domestic product (GDP).

The British government has planned to cut the deficit to 4.7 percent of GDP in the fiscal year 2014-2015, which is higher than the cap of 3 percent set by the European Union.

However, Mackel said, "I don't think that there will be a debt crisis. The demand for gilts has been relatively strong, so I don' t really buy into the crisis scenario in the UK."

The Chancellor, Alistair Darling, will present his third and possibly final, budget statement to parliament on March 24. It is expected that he would forecast the deficit for the fiscal year of 2011-2012 and announce measures to reduce the deficit.

When asked whether the UK would suffer a Greece-style debt crisis, Mackel said that the UK is in a different situation where it has a very liquid and big bond market compared with some of the small peripheral European countries. "That is to certain extent an advantage for the UK," he added.

The UK has had greater currency flexibility compared to some of the weaker members of the Eurozone, he said. "This crisis has taught us some important lessons and having currency flexibility has helped out incredibly."

Greece is now still in a need for an effective solution for its debt crisis. "We can't focus purely on the situation in the UK. We have a very big fiscal deficit in Japan or even a very big fiscal deficit in the U.S.," he said.

In his view, the pending general election is a key reason for investors to be worried that a debt crisis would emerge in the UK. "Both the Labour and Conservative parties seem to have a sense of wanting to reduce a fiscal drag on the economy," he said.