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Politics
Greg Evans
Sep 28, 2022
Liz Truss 'prepared to be unpopular' with plans to 'grow British economy'
Sky News
The Bank of England has said it will launch a temporary UK government bond-buying programme as an emergency move to stave off a “material risk to UK financial stability”.
The Bank of England said it will intervene in the bond market after a recent sell-off and surge in bond yields.
In a statement, the Bank said: “Were dysfunction in this market to continue or worsen, there would be a material risk to UK financial stability.
“This would lead to an unwarranted tightening of financing conditions and a reduction of the flow of credit to the real economy.
“In line with its financial stability objective, the Bank of England stands ready to restore market functioning and reduce any risks from contagion to credit conditions for UK households and businesses.
“To achieve this, the Bank will carry out temporary purchases of long-dated UK government bonds from September 28. The purpose of these purchases will be to restore orderly market conditions.
“The purchases will be carried out on whatever scale is necessary to effect this outcome. The operation will be fully indemnified by HM Treasury.”
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On Tuesday in International Monetary Fund gave a grim assessment of the current state of the UK economy, while there were also bizarre suggestions that the markets were moving in the way they were because they were worried about Keir Starmer becoming prime minister.
Reaction to the plummeting pound and the Bank of England's intervention is as you'd suspect, one of shock, awe and a bit of gallows humour.
\u201cSenior Tory MP : "Kwasi and Liz will have to go. They have to, they are actually crashing the economy."\u00a0\nWhen asked how long he would give them, he says "weeks".\u201d— Agnes Chambre (@Agnes Chambre) 1664363084
\u201cThis is still the Prime Minister\u2019s pinned tweet\u201d— Daniel Hewitt (@Daniel Hewitt) 1664363420
\u201c$500 billion? Even Dido would blush at that.\u201d— THE SECRET TORY \ud83c\uddec\ud83c\udde7 (@THE SECRET TORY \ud83c\uddec\ud83c\udde7) 1664284692
\u201cOne for political studies and media students\u201d— Ben Page (@Ben Page) 1664236671
\u201cThe Tories have completely and utterly fucked us - all because they wanted to wage class war on behalf of the rich\u201d— Owen Jones (@Owen Jones) 1664363282
\u201cHard to see how Keir Starmer survives this \u2026\u201d— Kevin Schofield (@Kevin Schofield) 1664360780
\u201cAmericans traveling to England this fall with a weak Pound\u201d— litquidity (@litquidity) 1664298166
\u201cLiz Truss checking the value of the pound tomorrow morning\u201d— SHANE REACTION (@SHANE REACTION) 1664209909
\u201c*KWARTENG TO ASK FINANCIERS NOT TO BET AGAINST POUND: SKY\n\nwords fail me\u201d— Paul McNamara (@Paul McNamara) 1664353789
\u201cFriday:\n\n\u2018Cuts to stamp duty will get the housing market moving and support first-time buyers\u2019\n-Kwasi Kwarteng \n\nTuesday:\n\n\u2018300 mortgage deals have been pulled by banks and building societies after fall in the pound fuelled forecasts of jump in interest rates to nearly 6%\u2019\u201d— Paul Johnson (@Paul Johnson) 1664282596
\u201cWhat a day.\n\n\ud83d\udd25 Kwarteng to beg bankers not to bet against the pound.\n\n\ud83d\udd25 ConHome publishes article claiming pound crashed because of... Starmer.\n\n\ud83d\udd25 Bridgen says pound didn't crash - dollar just rose.\n\n\ud83d\udd25 Odey says pound crashed because of anti-govt City... remainers.\n\nClowns.\u201d— Mike Galsworthy (@Mike Galsworthy) 1664357642
\u201cTook my 97 year old blind mother to the trading floor, she said \u201cwhich way to short the pound because of fear of a Starmer government\u201d and all the traders cheered\u201d— . (@.) 1664357067
\u201cThis could hardly be more serious.\n\nThe Bank of England says if it doesn\u2019t step in to buy long-term Government debt TODAY \u201cthere would be a material risk to UK financial stability\u201d\u201d— Carl Dinnen (@Carl Dinnen) 1664360241
\u201cnot saying things aren't going brilliantly but the Bank of England has just announced a hugely unusual market intervention to steady the markets after Friday's Budget\u201d— Jim Pickard (@Jim Pickard) 1664360341
\u201cTanked of England\u201d— Greg Johnson (@Greg Johnson) 1664360539
\u201cSomewhere in Leeds, a retired teacher is sat in disbelief, regretting the day they told a young Liz Truss to be \u201cmore assertive\u201d\u201d— Luke McGee (@Luke McGee) 1664361389
\u201cA currency trader tells me that sterling is falling because of the increase in restaurants that sell "pies" that are just a bit of pastry on the top of the dish, rather than all the way around.\u201d— Chris Curtis (@Chris Curtis) 1664358761
\u201cTory minister: "Kwasi is toast"\u201d— Robert Peston (@Robert Peston) 1664361955
\u201cThis is......bad\u201d— Chris Giles (@Chris Giles) 1664359943
\u201cIn some ways it\u2019s shame that absolutely no one voted for any of this\u201d— Tom Peck (@Tom Peck) 1664360528
\u201cAnd where is Liz Truss? She\u2019s hiding in a fridge, probably.\u201d— Martyn Conterio (@Martyn Conterio) 1664363823
\u201cKwasi Kwarteng receives shortest email in recorded history:\u201d— Have I Got News For You (@Have I Got News For You) 1664360181
Additional reporting by PA.
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