Liz Truss was sworn in as UK Prime Minister just weeks ago. But she is now battling to keep her job after shredding her economic growth plan.
US President Joe Biden has called embattled British Prime Minister Liz Truss’ abandoned tax cut plan a “mistake” as the governor of the Bank of England warned that interest rates may need to rise in the short term following the financial turmoil caused by the British government’s mini-budget.
“I wasn’t the only one that thought it was a mistake,” Biden said. “I disagree with the policy, but that’s up to Great Britain.” Britain’s economy is teetering in brink of a recession with gross domestic product, the measure of the quantity of goods and services produced, shrinking by 0.3 per cent in August from July following a slump in manufacturing and by maintenance work that slowed the oil and gas sector.
Hunt is reportedly poised to also delay a cut to income tax, where the basic rate would be cut from 20 per cent to 19 per cent from April 2023. In a series of interviews, Hunt declared that he would slow down Truss’s tax cuts and “some taxes will go up”. Prior to Bailey’s comments, the markets were expecting a rise of between 0.75 per cent and 1 per cent when the Bank’s Monetary Policy Committee makes its next rates decision in November.
Chancellor of the Exchequer, Jeremy Hunt, has announced he will roll back many of tax cuts announced under Liz Truss.reported a source saying: “His view is that the wagons are still going to circle”, with senior officials Downing Street believing it is a matter of time before she is forced out of office.
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