:Liz Truss stated that it was urgent to act to grow our economy, move Britain and deal with inflation.
British Prime Minister Liz Truss has defended her economic plan and stated that she is willing to take “difficult choices” in order to see the economy grow.
British Prime Minister Liz Truss, on Thursday, defended her economic plan. She ignored the negative reaction of financial markets and said she was willing to take “difficult choices” in order to grow the economy.
Truss made her first public remarks since the announcement by the government of billions of dollars in uncosted tax cuts that roiled markets, driving the pound to record lows. She said Britain was facing “very difficult economic times”. However, she claimed the problems were global, and were exacerbated by Russia’s invasion.
After the Bank of England took urgent action Wednesday to stabilize U.K. economic markets and prevent a wider economy crisis, after investors were scared by a government program of unfunded tax cuts. This sent the pound plummeting and the cost of government borrowing skyrocketing.
Truss stated that it was urgent to act to grow the economy, move Britain and deal with inflation.
“Officially, many of the measures we have announced will not happen overnight. She said that growth won’t happen overnight. “What’s important is that we put this country on the right track for the long-term.”
Truss stated in a series interview that her government’s decision not to cap energy bills for businesses and households would help to tame inflation, and assist millions of people who are facing a crisis of affordability.
However, it wasn’t that announcement that alarm the markets. The announcement by the government on Friday of an economic stimulus plan that included 45 billion pounds ($48 Billion) in tax cuts and no spending reductions, without independent economic analysis of its cost and effect.
The Bank of England stated that falling confidence in the economy could pose a “material threat to U.K. Financial stability” and would purchase long-term government bonds in the coming weeks to counter a recent decline in British financial assets.
Mark Carney, the bank’s former governor, stated that the central bank and government appeared to be moving in opposite directions.
He explained to the BBC that despite having a limited budget in such circumstances (tough global economy, difficult financial market situation, and working with the Bank at cross-purposes) it has resulted in quite dramatic movements in the financial markets.
On Thursday, the pound traded at $1.08, a level that was higher than Monday’s record low of $1.0373. The pound has lost approximately 4% since Friday.
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