Austerity measures give the UK a fighting chance

The Frankenstein currency, bolted together out of Deutsche marks and drachmas, francs and liras, is seeing its various limbs begin to drop off.

It is worth reminding ourselves that these measures were similar to the ones the Coalition introduced last year. As a pale and obviously very tired George Osborne said to a business audience on Tuesday night, we had our emergency Budget last summer on our terms rather than this summer on the market's terms.

The result is stable government borrowing costs of 2.17pc here, 3.18pc in France and rising and 7.25pc in Italy and unsustainable.

People here are on the streets protesting against austerity made necessary by the profligacy of the previous government.

But capital markets are making it clear that the UK economy is in a better place than those of its crises hit eurozone neighbours, thanks to the measures taken early and unilaterally after last year's election. Sadly we can't escape the impact of a collapsing single currency but we have a fighting chance of surviving it thanks to policies already adopted which others are only now accepting as inevitable, albeit too little too late.

damian.reece@telegraph.co.uk

Source: http://telegraph.feedsportal.com/c/32726/f/568312/s/19f561a7/l/0L0Stelegraph0O0Cfinance0Ccomment0Cdamianreece0C8880A0A0A90CAusterity0Emeasures0Egive0Ethe0EUK0Ea0Efighting0Echance0Bhtml/story01.htm

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