In view of the ongoing criticism of his budget plans, the British finance minister, Kwasi Kwarteng, has had to vacate his post. The minister will be dismissed, the BBC and the newspaper report Times consistent. A successor has not yet been determined.
Prime Minister Liz Truss also wanted to announce at a press conference in the afternoon that she would withdraw large parts of the economic plans that she announced just a few weeks ago.
The head of government, who has only been in office since September 6, has come under heavy pressure from within her own ranks because of the projects financed solely on debt. With the dismissal, Truss would make Kwarteng a scapegoat and try to save her own head, British media speculate.
According to the BBC Kwarteng is now the second shortest-serving finance minister in the UK. Only Iain Macleod was in office for a shorter time in 1970. He died of a heart attack 30 days after taking the post. Counting today, Kwarteng has 39 days.
Just over five weeks after taking office, Truss is under massive pressure in her own party. The Prime Minister wants to appear before the press in the afternoon. It is expected to roll back large parts of its recently announced tax plans that have caused major economic turmoil.
Pound down
The financial markets had reacted violently after the announcement of significant tax cuts without a counter-financing plan in September. The pound plummeted against the US dollar. The Bank of England has had to intervene and buy government bonds on several occasions to sustain their price falls and prevent pension funds from collapsing. Rising interest rates on home loans exacerbated the cost of living crisis for many homeowners.
The government then withdrew the planned abolition of the top tax rate and, after some hesitation, announced that it would bring forward the presentation of the entire budget by a few weeks. But that only calmed the financial markets temporarily. Fed chief Andrew Bailey recently announced an end to bond purchases for this Friday. According to some experts, he wanted to force the government to give in. Financial markets reacted positively to reports of a government reversal.
It is questionable whether Truss will be able to calm the financial markets and consolidate their position with the dismissal of their Chancellor of the Exchequer and the expected reversal. British media have already speculated that her party could soon overthrow her.