British Prime Minister Liz Truss has fired her Chancellor of the Exchequer, Kwasi Kwarteng, amid massive domestic unrest. He stumbled upon his plans to cut the top tax rate, which Truss has since had to personally withdraw. The successor has already been determined: the former Secretary of State and Health Jeremy Hunt. Truss is under enormous pressure in her own party five weeks after taking office.
Hunt succeeds the previous chairman of the health committee in the UK parliament, who had run for head of the Conservative Party over the summer but failed after just a few rounds of voting.
The new minister was one of the harshest critics
During the pandemic, the 55-year-old was one of the government’s harshest critics. Prior to Hunt’s appointment, Kwarteng said he would support Truss and his successor. He resigned after Prime Minister Liz Truss asked him to, Kwarteng previously explained: “They asked me to resign as their finance minister. I accepted.” Truss’ ideas are correct, he wrote on Twitter.
The prime minister wants to appear before the press in the afternoon. It is expected to reverse many of its recently announced tax plans that have sparked major economic turmoil.
Bank of England had to help several times
Financial markets reacted violently after the announcement of significant tax cuts with no counter-financing plan in September. The pound plunged against the US dollar. The Bank of England has had to intervene several times and buy up government bonds to withstand the fall in prices and prevent the bankruptcy of pension funds. Rising interest rates on home loans exacerbated the cost of living for many homeowners.
Truss with U-turn
The government subsequently withdrew the planned abolition of the top tax rate and, after some hesitation, announced that it would also bring forward the presentation of the entire budget plan by several weeks. But that only temporarily calmed the financial markets.
Fed chief Andrew Bailey recently announced an end to bond purchases for next Friday. According to some experts, he wanted to force the government to give in. The financial markets reacted positively to reports of a turnaround by the government.
The question is whether Truss will be able to calm the financial markets and consolidate their position with the resignation of their Treasury Secretary and the expected turnaround. British media have already speculated that her party could soon topple her.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
