British finance minister Kwasi Kwarteng told leading bankers, insurers and asset managers he was “confident” that his economic strategy would work, the Financial Times reported on Tuesday.
The pound touched an all-time low of $1.0327 on Monday and British government bonds sold off at a ferocious pace as investors lost confidence in Prime Minister Liz Truss’s new government following a fiscal statement from Kwarteng on Friday.
“I’m confident that with our growth plan and the upcoming medium-term fiscal plan — with close co-operation with the Bank — our approach will work,” the FT reported, citing a readout of a meeting with leading financial firms.
“We have responded in the immediate term with an expansionary fiscal stance on energy because we had to,” the FT quoted Kwarteng. “With two exogenous shocks — Covid-19 and Ukraine — we had to intervene. Our 70-year high tax burden was also unsustainable.”