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The pound has plummeted to an all-time low against the dollar following the sweeping tax cuts announced by chancellor Kwasi Kwarteng in last week’s mini-budget.
At one point the pound plunged by nearly 5% to stand at $1.0327, its lowest point since Britain went decimal in 1971. It later recovered slightly to $1.05, but was still 7% than its value before Friday’s announcement.
It comes as the new government unveiled its latest fiscal plan last Friday (23 September), which saw the new chancellor unveil a £45bn tax cut package.
Kwarteng and Truss have been accused by some of “gambling” with the UK’s economy under the new economic plan, however, with investors reportedly losing trust in the trickle-down economics of the new measures.
Shadow chancellor Rachel Reeves told Times Radio: “Instead of blaming everybody else, the chancellor and the prime minister, instead of behaving like two gamblers in a casino chasing a losing run, they should be mindful of the reaction not just on the financial markets but also of the public.
“The idea trickle-down economics – making those at the top richer still – will somehow filter through to everybody else has been tried before, it didn’t work then, it won’t work now.”
She added: “So, financial markets are unimpressed, the British public are unimpressed and the chancellor and the prime minister need to take note because they’re not gambling with their own money, they’re gambling with all our money, and it’s reckless and it’s irresponsible as well as being grossly unfair.”
