Chaos in the Economy
Rachel Reeves will be hauled before Parliament today after a market meltdown sent borrowing costs soaring and the pound into a nosedive. The Chancellor will be forced to break cover after jetting off to China while Britain’s economy took a battering — with Tories accusing her of "fleeing" the chaos.
Tough Questions Ahead
The Chancellor will deliver a statement in the Commons about her China visit, but she faces tough questions on Britain’s grim economic outlook after UK borrowing costs hit a 27-year high and the pound slumped to its lowest level since 2023.
Political Reactions and Concerns
Former shadow chancellor John McDonnell warned cuts to balance the books would be "politically suicidal" and suggested a wider review of economic strategy is necessary. Labour had promised during the 2024 election campaign not to increase taxes on "working people", explicitly ruling out a rise in income tax, VAT or national insurance.
Market Stabilization
Ministers were offered some relief on Tuesday morning as the pound regained its footing after hitting fresh 14-month lows on Monday, while UK Government bonds recovered some lost ground after a recent heavy sell-off.
