The pound has seen a slight recovery in trading on Asian markets, after crashing to an all-time low against the US dollar a day earlier in the wake of new chancellor Kwasi Kwarteng’s mini-budget.
The Bank of England warned that interest rates could be hiked “by as much as needed” to control inflation, with some mortgage lenders to temporarily withdraw deals for new customers as traders banked on interest rates hitting nearly 6 per cent next year, sparking some fears of a housing crash.
The turmoil comes after Mr Kwarteng announced controversial tax cuts worth £45bn on Friday, mainly benefitting those in the highest bracket.
Amid market panic over the borrowing-fuelled tax cut spree, the Treasury said on Mondya that Mr Kwarten would reveal the government’s “fiscal plan” on 23 November.
The government said the statement would include details on the new approach to borrowing, spending and tax-raising rules, including a pledge to ensure debt falls as a share of GDP in the “medium term”.
