UK Prime Minister Talked Into Issuing Stock Market Stabilizing Statement - Reports

UK Prime Minister Liz Truss had to be persuaded to release a statement regarding her tax-cutting plans after sterling plunged in response to the prospective increase in government borrowing, British broadcaster Sky News reported on Tuesday

MOSCOW (UrduPoint News / Sputnik - 27th September, 2022) UK Prime Minister Liz Truss had to be persuaded to release a statement regarding her tax-cutting plans after sterling plunged in response to the prospective increase in government borrowing, British broadcaster Sky news reported on Tuesday.

Truss met with Chancellor of the Exchequer Kwazi Kwarteng, who told her they had to communicate on her plans, as she did not initially think this was necessary, the tv channel said, referring to unnamed sources. It added the government would deny rumors circulating in government ministries that the meeting was argumentative and descended into a shouting match.

As a result of this conversation, the Treasury announced the same day that further information on supply-side policies to stimulate growth would be announced in the coming weeks, and that the Chancellor would set out his Medium-Term Fiscal Plan on November 23.

"The Fiscal Plan will set out further details on the government's fiscal rules, including ensuring that debt falls as a share of GDP in the medium term," the statement added.

On Friday, Kwarteng announced a 45 billion pound ($48 billion) tax-cutting package that would benefit the highest earners most, causing concern about unsustainable government borrowing. It was the biggest package of tax cuts in 50 years announced "without even a semblance of an effort to make the public finance numbers add up," Institute for Fiscal Studies Director Paul Johnson said in comments on the measure.

On Monday, the British pound fell to an all-time low of $1.0384 against the US Dollar, putting further pressure on Truss.