Liz Truss appoints Jeremy Hunt as Chancellor of the Exchequer and withdraws UK tax cuts

Liz Truss appoints Jeremy Hunt as Chancellor of the Exchequer and withdraws UK tax cuts

british prime minister, Les TrussLast Friday, he sacked his finance minister and his great ally Quasi QuartingHowever, he insisted on implementing the economic plan, hardly modified, at the origin of a political storm that threatens its continuity.

“We have to act now to calm the markets,” the Conservative leader said.

To do so, the head of government, who took office just over a month ago, agreed to capitulate again and announced that she would increase the corporate tax, a measure the previous government was determined to abolish.

However, she declared she was “absolutely determined” to carry on with the rest of her tax cuts plan, in order to “deliver stronger growth, a more prosperous UK, and weather the storm”.

In a highly volatile market, political instability weighed on the British pound again on Friday, which depreciated by 1.20% against the dollarup to $1.1188 per unit.

British financial markets have been shaken by extreme tension since September 23 gears and quarting They offered a package of measures that expected significant public aid and tax cuts, but nothing to fund them.

As a result, interest rates on British government bonds rose to record levels, forcing Bank of England To intervene by buying long-term bonds.

The central bank – an entity independent of the government – sought to stop the rate hike, but failed, and when it announced that it would not prolong buying beyond Friday, it created more chaos in the markets.

In this tense context, Kwarteng, 47, a radical liberal born in London to Ghanaian immigrant parents, has been fired in an attempt to save Truss.

She wrote in a message posted on Twitter after rushing back from Washington, where she was due to attend the annual meetings of the International Monetary Fund. global bank.

calm the crisis of confidence

Kwarteng was promptly replaced by former Secretary of State and Health Jeremy Hunt.

Hunt, 55, is popular with part of the Tory MPs and is one of the most dangerous, though not very charismatic, figures among the candidates vying for the leadership of the Tory party in July.

According to the British press, many members of the Conservative Party are already trying to remove Truss, in the face of disastrous opinion polls predicting a landslide defeat for the right in the upcoming legislative elections.

It is scheduled for January 2025 at the latest, but the political and economic storm caused by the controversial tax cuts appears to be making it impossible for the Tory leader to stay in power until then.

Truss, 47, arrived in Downing Street on September 6. He succeeded the controversial Boris Johnson, whose rank forced him to resign as a result of the proliferation of scandals that destroyed his popularity.

But just a month later, the new Tory leader has turned against markets, voters and leading figures from her party.

Under pressure from the formation, Truss and Quarting already had to give in in early October over one of the most contentious measures.

It was about eliminating the top tax bracket, 45%, for incomes over £150,000 ($170,000) a year, accused of favoring the rich when many Britons sink into poverty burdened by inflation that is already close to 10% and should continue to increase.

Also seeking reassurance, Kwarteng later agreed to advance the publication of budget forecasts until October 31, instead of the initially announced November 23.

But it wasn’t enough.

The presentation will now be performed by Hunt. Truss will have to show whether a change of head in the portfolio is enough to contain the crisis of confidence.

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