Liz Truss News – Live: Pound falls to record low against dollar as economists slam budget plan

Close

Chancellor Kwasi Kwarteng says mini-budget will benefit people "at all income levels"

The pound plunged almost 5% to an all-time low as investors rushed for the exits after the new government's budget plan government threatened to stretch Britain's finances to the limit.

The currency fell to an all-time low of $1.0327, extending a 3.61% plunge from Friday when Finance Minister Kwasi Kwarteng triggered historic tax cuts.

Economists have raised concerns over the financial credibility of Prime Minister Liz Truss' government as the unveiling of such a plan came just a day after the Bank of England hiked rates interest rate to contain inflation.

Meanwhile Sir Keir Starmer said he would resist pressure from his own party to reverse Mrs Truss' 1p cut for ratepayers base, fearing it could deal a fatal blow to Labor's chances of winning the next election.

The Labor leader has made a dramatic pledge to restore the income tax rate of 45 pence for the richest people in Britain, abolished by Mr Kw arteng in his mini budget in what Sir Keir described as a 'senseless' Conservative policy to 'allow the rich to get richer'. "says John McDonnell

Former shadow chancellor John McDonnell said the pound fell to near parity with the dollar because of a loss of confidence in the government.

The Labor MP for Hayes and Harlington, who was shadow chancellor under Jeremy Corbyn, told BBC Radio 4's Today programme: 'It's because people internationally have - not just us - lost faith in this government and the mini budget, I think, was a shock to everyone... not just because it was so unfair, because it was unstable and didn't let the economy pass. p>