UK finance minister Kwarteng not to step down: Treasury source
Britain’s finance minister Kwasi Kwarteng is not resigning and there will be no reversal of economic policy, a Treasury source said on Wednesday, confirming an earlier report by Sky News.
According to Reuters, Kwarteng’s tax-cut plans, on top of an energy bill bailout – all funded by a huge increase in government borrowing – have triggered financial market chaos.
Kwarteng sought to reassure investment bank executives in a meeting described by attendees as nervous, and two senior Bank of England (BoE) officials pulled out of public events scheduled for Wednesday and Thursday.
One source at the meeting said Kwarteng had asked the assembled finance bosses what they could do to calm markets.
Meanwhile, the BoE on Wednesday sought to quell the firestorm in Britain’s bond markets, saying it would buy as much government debt as needed to restore order after new Prime Minister Liz Truss’s tax cutting plans triggered financial chaos.
The BoE will now buy up to £5 billion (204 billion baht) a day of British government bonds of at least 20 years’ maturity starting on Wednesday and running until October 14.
Its announcement, which represented a sudden reversal of plans to sell bonds it had amassed since the global financial crisis of 2008-2009, immediately pushed down borrowing costs.
The BoE said it would return to its plan to sell bonds at the end of October.
