Pound Falls to 37-Year Low Against Dollar Before Mini-Budget;  UK Consumer Confidence Weakest on Record: Business Live |  Business

Pound Falls to 37-Year Low Against Dollar Before Mini-Budget; UK Consumer Confidence Weakest on Record: Business Live | Business

Sterling has dropped to a fresh 37-year low against the US dollar – an unwelcome backdrop to Kwasi Kwarteng’s mini-budget this morning.

“,”elementId”:”e5e0185d-9ec3-4e5f-bb42-30a392273f05″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The pound has fallen below $1.12, the weakest point since 1985, and has now shed 17% against the dollar so far this year.

“,”elementId”:”5a6c5e12-e798-4f14-8d9e-7e80d887f739″},{“_type”:”model.dotcomrendering.pageElements.ImageBlockElement”,”media”:{“allImages”:[{“index”:0,”fields”:{“height”:”485″,”width”:”1131″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/1131.jpg”},{“index”:1,”fields”:{“isMaster”:”true”,”height”:”485″,”width”:”1131″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg”},{“index”:2,”fields”:{“height”:”429″,”width”:”1000″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/1000.jpg”},{“index”:3,”fields”:{“height”:”214″,”width”:”500″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/500.jpg”},{“index”:4,”fields”:{“height”:”60″,”width”:”140″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/140.jpg”}]},”data”:{“alt”:”The pound vs the US dollar”,”caption”:”The pound vs the US dollar”,”credit”:”Photograph: Refinitiv”},”displayCredit”:true,”role”:”inline”,”imageSources”:[{“weighting”:”inline”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”thumbnail”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=140&quality=85&auto=format&fit=max&s=41cd7ddadcbea9c77247c53c9726d81c”,”width”:140},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=140&quality=45&auto=format&fit=max&dpr=2&s=459790772ab60f0f44dd9aa8f7bdbf1b”,”width”:280},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=120&quality=85&auto=format&fit=max&s=de8cc54d0595f2f88c126e1a051d1e9d”,”width”:120},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=120&quality=45&auto=format&fit=max&dpr=2&s=c9bb54a6a6e8c7a594593cf3fe38798a”,”width”:240}]},{“weighting”:”supporting”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=380&quality=85&auto=format&fit=max&s=6a00a84e9d9061f2fa5b7db05bca70bc”,”width”:380},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=380&quality=45&auto=format&fit=max&dpr=2&s=7aa30c16ba1c98ef798ae2c4fcc555a6″,”width”:760},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=300&quality=85&auto=format&fit=max&s=fad03e6219c50fae73b53318201f91d7″,”width”:300},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=300&quality=45&auto=format&fit=max&dpr=2&s=19b4b29567d92496151a640959f307a9″,”width”:600},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”showcase”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=860&quality=85&auto=format&fit=max&s=98a35be39380a28c1dedb56e36cea78c”,”width”:860},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=860&quality=45&auto=format&fit=max&dpr=2&s=5f14f53e720eb86028cfe8745c47aa2b”,”width”:1720},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=780&quality=85&auto=format&fit=max&s=06818e61676b9c4eb933484553cb9a88″,”width”:780},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=780&quality=45&auto=format&fit=max&dpr=2&s=e612a6ec09d4e7d4b6724d7c9fda1161″,”width”:1560},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”halfwidth”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”immersive”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1900&quality=85&auto=format&fit=max&s=0d3ea282ce58e800ad8f785252124927″,”width”:1900},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1900&quality=45&auto=format&fit=max&dpr=2&s=144ab69b8c1d5c91d4ba925b49574656″,”width”:3800},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1300&quality=85&auto=format&fit=max&s=63b1e191f30bb112a2e7078bc6cd4da7″,”width”:1300},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1300&quality=45&auto=format&fit=max&dpr=2&s=31b62f371e500785622ac05778928b47″,”width”:2600},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1140&quality=85&auto=format&fit=max&s=490144a7b822de9d969583cb5254695b”,”width”:1140},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1140&quality=45&auto=format&fit=max&dpr=2&s=132859f73ea11a55726182924ba7bc79″,”width”:2280},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=980&quality=85&auto=format&fit=max&s=91f1a7c5704f8cfda20996bc4c98073d”,”width”:980},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=980&quality=45&auto=format&fit=max&dpr=2&s=bb7e8bda9ebba98f61359c740b199745″,”width”:1960},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=740&quality=85&auto=format&fit=max&s=9c110c51a5a1d9a11758e99aed8fe7ee”,”width”:740},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=740&quality=45&auto=format&fit=max&dpr=2&s=713b8f2cca3a9d2470c5c9896556855c”,”width”:1480},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=660&quality=85&auto=format&fit=max&s=192802f54e8171880b6c00e83afb3d08″,”width”:660},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=660&quality=45&auto=format&fit=max&dpr=2&s=af87253c8d48f1cfb9a06a792b58beed”,”width”:1320},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=480&quality=85&auto=format&fit=max&s=9ba52c5e99a9745fc5a35e53953b6ffd”,”width”:480},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=480&quality=45&auto=format&fit=max&dpr=2&s=e6439ec989c8f4baaa0f4ef6a79c10d6″,”width”:960}]}],”elementId”:”8f8f0f61-f8d4-44ea-a55c-2011148d3158″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The decline is partly due to dollar strength – the greenback is at 20-year highs against a basket of currencies, due to worries about the global economy and the series of large interest rates by the US Federal Reserve.

“,”elementId”:”2557ed49-c4dc-4f51-a3a9-d6703efe652b”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

But it’s also due to concerns over the UK economy as it teeters towards recession.

“,”elementId”:”973eafc1-cedf-42c6-96f2-36e79e462cdf”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Investors are anxious that Kwarteng’s mini-budget will drive up borrowing – especially as the Office for Budget Responsibility has not been allowed to provide forecasts for today’s event.

“,”elementId”:”313a47f4-fec1-4224-a3fa-0cc10b761805″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

RBC Capital Markets say markets are left to speculate on “who has the appetite for gilts when the BoE is selling and the govt is ramping up borrowing at a dizzying pace”.

“,”elementId”:”e47e7880-47ec-4150-b6fc-3e77c6d26adb”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

They forecast that the pound could fall even lower, to below $1.05 – which would be an all-time low.

“,”elementId”:”e70969ed-5cff-4a31-acea-611152c0168a”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

For us, it leaves weaker GBP [the pound] as the clearest escape valve to keep financing a large current account deficit.

\n

Our forecast is currently sub-1.05 for GBP/USD. If the Chancellor’s gamble to boost growth fails to pay off, it will leave GBP in an even bigger hole.

\n

“,”elementId”:”5d3e6250-0c58-4217-9267-36ddb7df49b3″},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

Bracing start to mini Budget day – pound dips below $1.12 at one point touching new 37-year low pic.twitter.com/ufa1J0LUSa

— Paul Kelso (@pkelso) September 23, 2022

\n”,”url”:”https://twitter.com/pkelso/status/1573207875505340416″,”id”:”1573207875505340416″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”fac4dabb-e8d8-442d-a353-408ff28b042a”}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663916728000,”blockCreatedOnDisplay”:”08.05 BST”,”blockLastUpdated”:1663917919000,”blockLastUpdatedDisplay”:”08.25 BST”,”blockFirstPublished”:1663917540000,”blockFirstPublishedDisplay”:”08.19 BST”,”blockFirstPublishedDisplayNoTimezone”:”08.19″,”title”:”Pound hits 37-year low against dollar as UK ‘ramps up borrowing at a dizzying pace'”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”},{“id”:”632d586e8f0894f47d8a3b7d”,”elements”:[{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Simon Clarke, the Secretary of State for Levelling Up, has denied that the government’s fiscal plans are a gamble.

“,”elementId”:”726fad40-40bf-467e-9d72-a357da6fa5af”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

On this morning’s media rounds, Clarke told the BBC that tax cuts will spur economic growth that outstrips rising national debt.

“,”elementId”:”43e89370-6587-4c3b-821e-24dadf6c20fa”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“The evidence of the 1980s and the 1990s is that a dynamic low tax economy is what delivers the best growth rates – this isn’t a gamble, the weight of history and evidence is with us.”

\n

“,”elementId”:”e4c6cde0-8416-4c30-ab26-f04abcddb307″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Clarke also told Sky News that the budget will be a game-changer, and that growth will pay for the UK’s government spending plans

“,”elementId”:”b0c74a22-0fdf-4449-ad0d-ea9521c9aa97″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Asked if his view last year that some tax increases would be needed to repair government finances still applied, Clarke said:

“,”elementId”:”90705bef-8006-40fc-8046-76a9c60f0fff”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“No, because what you’re doing now is that you’re going for growth…

\n

The critical thing is we need to get the economy growing so that, frankly, the economic growth trajectory outstrips that of our debt.”

\n

“,”elementId”:”597b89ad-f432-4472-bb76-2f14d5851dc2″}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663916142000,”blockCreatedOnDisplay”:”07.55 BST”,”blockLastUpdated”:1663916759000,”blockLastUpdatedDisplay”:”08.05 BST”,”blockFirstPublished”:1663916759000,”blockFirstPublishedDisplay”:”08.05 BST”,”blockFirstPublishedDisplayNoTimezone”:”08.05″,”title”:”Minister: plans aren’t a gamble”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”},{“id”:”632d49d58f0822acf24f4e11″,”elements”:[{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Kwasi Kwarteng will on Friday announce 30 separate measures – including tax cuts, new investment zones and an acceleration of infrastructure projects – in an effort to raise the economy’s growth rate to his stated target of 2.5% a year.

“,”elementId”:”3ce2d369-4139-4fe0-838f-15eb6ba901d9″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

One of the main elements of the package – the £13bn reversal of the increase in national insurance contributions, introduced in April to fund the health and social care levy – will come into force on 6 November.

“,”elementId”:”3d06c8f4-9f5a-4862-a510-08c223d94799″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

While almost 28 million people will keep more of their earnings as a result of the move, the Resolution Foundation thinktank said on average the poorest 10% of households would gain £11.41 in 2022-23, while the richest 10% of households would gain £682.

“,”elementId”:”2c2924c4-0a40-455e-ac24-a1eb15df3f90″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The mini-budget is expected to contain significant further interventions to boost growth beyond the reversal of the NICs rise and next April’s planned increase in corporation tax, Treasury sources have confirmed, with one Whitehall source describing the package as having “more rabbits than Watership Down”.

One key plank of the fiscal event will be new investment zones for 38 local and mayoral authorities in England – including West Midlands, Tees Valley, Somerset and Hull – which will have major planning deregulation to release more land for housing and commercial development, and tax cuts for businesses.

“,”elementId”:”f2e3c49c-4b76-4279-abac-b7021a2803c3″},{“_type”:”model.dotcomrendering.pageElements.RichLinkBlockElement”,”url”:”https://www.theguardian.com/uk-news/2022/sep/22/uk-recession-interest-rate-hikes-bank-of-england-kwasi-kwarteng-tax-cut-mini-budget”,”text”:”UK in recession and further interest rate hikes probable, Bank warns Kwarteng”,”prefix”:”Related: “,”role”:”thumbnail”,”elementId”:”2910a1c5-8b5c-4aaa-b584-543e054c9c9d”}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663915246000,”blockCreatedOnDisplay”:”07.40 BST”,”blockLastUpdated”:1663915570000,”blockLastUpdatedDisplay”:”07.46 BST”,”blockFirstPublished”:1663915570000,”blockFirstPublishedDisplay”:”07.46 BST”,”blockFirstPublishedDisplayNoTimezone”:”07.46″,”title”:”Mini-budget: what we expect”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”},{“id”:”632d48dd8f0822acf24f4e06″,”elements”:[{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Good morning, and welcome to our rolling coverage of business, the world economy and the financial markets.

“,”elementId”:”ea93ccea-4bf6-44d1-84e0-4af7d4ce8e5d”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Consumers across the UK are the gloomiest on record as the economic picture darkens… as the government announces its plan to kick-start UK economic growth with a flurry of tax cuts that will drive up borrowing.

“,”elementId”:”f33ecd32-1bb7-4320-a7a3-9f2fcf0705f4″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

People are increasingly worried about their personal finances, and anxious that the economy is turning sour, research body GfK warns, a day after the Bank of England said the UK has probably entered recession this quarter.

“,”elementId”:”8839f7d8-c92c-4694-b195-8c46d8a79e8b”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

GfK’s long-running Consumer Confidence Index has fallen another five points this month to a new low of -49.

“,”elementId”:”eb304acb-44cc-4527-8b06-4c7b0b6d48f5″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

That’s the worst since records began in 1974, as the tightening squeeze on living costs made people much more pessimistic about their own finances.

“,”elementId”:”fe61b5e9-2fc9-4e8e-8bed-c3927df47925″},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

In September the GfK UK Consumer Confidence Index fell a further five points to -49, setting a new record low, with data having been collected every month since 1974. pic.twitter.com/20bPQO2Hkk

— David Edwards (@ScattClouds) September 23, 2022

\n”,”url”:”https://twitter.com/ScattClouds/status/1573195980866203648″,”id”:”1573195980866203648″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”222d7899-fc56-43b6-a25f-eabef886a5c1″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

This is the fourth new low in five months, as the economy has been battered by rising prices and weakening activity.

“,”elementId”:”f2c0ac1d-ef46-4575-a87f-912456b59d39″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Confidence in personal finances over the coming year shed nine points to -40, while confidence in the economy over the next 12 months lost eight points to -68, a really grim reading.

“,”elementId”:”109cb680-33e6-4bc4-b335-414240174e17″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

People are also very unwilling to buy big ticket items, as soaring inflation forces households to cut back.

“,”elementId”:”a6ff4711-30f2-4c87-b413-b9a4862e77a6″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

GfK client strategy director Joe Staton said:

“,”elementId”:”e159ce25-32c1-498b-9d92-1c71f7684db3″},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“Consumers are buckling under the pressure of the UK’s growing cost-of-living crisis driven by rapidly rising food prices, domestic fuel bills and mortgage payments.

\n

“They are asking themselves when and how the situation will improve.

\n

“,”elementId”:”199ae046-c2cc-424d-9109-0e27798d520d”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Kwasi Kwarteng will vow to break the UK’s “cycle of stagnation” today, by lowering the tax burden in a hotly awaited mini budget..

“,”elementId”:”8633079c-4606-4f66-9a24-50be7f74a4f9″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

He’s expected to tell MPs that Britain needs a new approach, ‘focused on growth’, by saying:

“,”elementId”:”d503cc5b-decf-47ef-8383-e5adc76943e5″},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“Growth is not as high as it needs to be, which has made it harder to pay for public services, requiring taxes to rise.

\n

“This cycle of stagnation has led to the tax burden being forecast to reach the highest levels since the late 1940s.

\n

“,”elementId”:”782af03a-fd87-40b7-ab76-476db806e245″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Even though today’s statement is officially only a ‘fiscal event’, it’s expected to include a 30-point growth package, including scrapping a planned increase in corporation tax from 19% to 25%, plus reforms to the City of London, ending the cap on bankers’ bonuses, and plans to create up 38 new Investment Zones across England.

“,”elementId”:”93cedc8c-8ed3-429c-8a27-7cbd8bfb0642″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Yesterday Kwarteng said the national insurance increase introduced earlier this year will be reversed from 6 November.

“,”elementId”:”8782c2c3-5acc-423d-becf-741c3f3efab0″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

But economists are warning tht the plan will drive UK borrowing sharply higher, just as government borrowing costs are rising in the bond markets.

“,”elementId”:”78738fc5-44d8-4cd0-a522-a7eca3af5ec8″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The Institute for Fiscal Studies warned this week that Britain’s mounting debts will be unsustainable if the government presses ahead with sweeping tax cuts.

“,”elementId”:”a9776195-21ad-4b59-a64b-13b99541226c”},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

Even once the substantial Energy Price Guarantee has expired in October 2024, borrowing could still run at about £100 billion a year in the mid-2020s.

This is more than £60 billion a year higher than the @OBR_uk forecast in March.

[6/13] pic.twitter.com/iZNk5dKQxw

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

\n”,”url”:”https://twitter.com/TheIFS/status/1572632518570004480″,”id”:”1572632518570004480″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”1d6e9e6c-2631-45f8-b72f-3752b7be2a2c”},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

Persistent current budget deficits and rising debt as a share of national income would mean that the two main fiscal targets legislated only in January would be missed.

Even once the Energy Price Guarantee has expired, debt would be left on an ever-increasing path.
[9/13] pic.twitter.com/UuSf6BpXMU

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

\n”,”url”:”https://twitter.com/TheIFS/status/1572632526862024704″,”id”:”1572632526862024704″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”a1c3d282-6462-4dcf-a791-12887f57cb18″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

GfK’s Staton points out that today’s mini-budget, and the longer-term agenda to drive the economy, are a major opportunity to improve the economic outlook.

“,”elementId”:”8ce5ea04-6b38-47da-8358-3099fb79f54f”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

It will also be a major test for the popularity of Liz Truss’s new Government.”

\n

“,”elementId”:”1849864d-d223-40bc-9242-f9c39d5f70b3″},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

UK Consumers Fear for Their Future as Living Standards Plummet
Low st consumer confidence figures since Gfk started compiling survey in 1970s. https://t.co/eykHu9uNLL

— Louise Cooper (@Louiseaileen70) September 23, 2022

\n”,”url”:”https://twitter.com/Louiseaileen70/status/1573195325837303809″,”id”:”1573195325837303809″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”9c073c0a-93c1-4256-9e59-9e5ce26ee3c0″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

We also find out today how manufacturing and services companies in the UK, the US, and across the eurozone, are faring this month – and get a healthcheck on Britain’s retail sector.

“,”elementId”:”601884ff-54a0-4dba-9157-73e728a45b75″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Financial markets are subdued, as investors worry that interest rate hikes by central bankers are pushing major economies towards recession.

“,”elementId”:”51054229-24dd-4b0d-a772-9a7b319ac73f”},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

European Opening Calls:#FTSE 7157 -0.03%#DAX 12531 -0.01%#CAC 5922 +0.06%#AEX 655 -0.35%#MIB 21726 -0.34%#IBEX 7762 -0.16%#OMX 1837 -0.07%#SMI 10290 -0.08%#STOXX 3426 -0.03%#IGOpeningCall

— IGSquawk (@IGSquawk) September 23, 2022

\n”,”url”:”https://twitter.com/IGSquawk/status/1573172721978339328″,”id”:”1573172721978339328″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”857db97a-1b25-4157-a983-1cff14a62a32″},{“_type”:”model.dotcomrendering.pageElements.SubheadingBlockElement”,”html”:”

The agenda

“,”elementId”:”39ea9029-a932-48f3-8cee-ac0b66f0d942″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

    \n

  • 9am BST: Eurozone flash PMIs for September

  • \n

  • 9.30am BST: UK flash PMIs for September

  • \n

  • 9.30am BST: Chancellor Kwasi Kwarteng presents mini-budget

  • \n

  • 11am BST: CBI Distributive trends survey of UK retailers

  • \n

“,”elementId”:”8d5b363f-af2b-4998-b660-ab5f6f931586″}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663915246000,”blockCreatedOnDisplay”:”07.40 BST”,”blockLastUpdated”:1663915522000,”blockLastUpdatedDisplay”:”07.45 BST”,”blockFirstPublished”:1663915246000,”blockFirstPublishedDisplay”:”07.40 BST”,”blockFirstPublishedDisplayNoTimezone”:”07.40″,”title”:”Introduction: UK consumers fear for the future as living standards slide”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”}],”filterKeyEvents”:false,”format”:{“display”:0,”theme”:0,”design”:10},”id”:”key-events-carousel-mobile”}”>

key events

Sterling has dropped to a fresh 37-year low against the US dollar – an unwelcome backdrop to Kwasi Kwarteng’s mini-budget this morning.

“,”elementId”:”e5e0185d-9ec3-4e5f-bb42-30a392273f05″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The pound has fallen below $1.12, the weakest point since 1985, and has now shed 17% against the dollar so far this year.

“,”elementId”:”5a6c5e12-e798-4f14-8d9e-7e80d887f739″},{“_type”:”model.dotcomrendering.pageElements.ImageBlockElement”,”media”:{“allImages”:[{“index”:0,”fields”:{“height”:”485″,”width”:”1131″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/1131.jpg”},{“index”:1,”fields”:{“isMaster”:”true”,”height”:”485″,”width”:”1131″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg”},{“index”:2,”fields”:{“height”:”429″,”width”:”1000″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/1000.jpg”},{“index”:3,”fields”:{“height”:”214″,”width”:”500″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/500.jpg”},{“index”:4,”fields”:{“height”:”60″,”width”:”140″},”mediaType”:”Image”,”mimeType”:”image/jpeg”,”url”:”https://media.guim.co.uk/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/140.jpg”}]},”data”:{“alt”:”The pound vs the US dollar”,”caption”:”The pound vs the US dollar”,”credit”:”Photograph: Refinitiv”},”displayCredit”:true,”role”:”inline”,”imageSources”:[{“weighting”:”inline”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”thumbnail”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=140&quality=85&auto=format&fit=max&s=41cd7ddadcbea9c77247c53c9726d81c”,”width”:140},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=140&quality=45&auto=format&fit=max&dpr=2&s=459790772ab60f0f44dd9aa8f7bdbf1b”,”width”:280},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=120&quality=85&auto=format&fit=max&s=de8cc54d0595f2f88c126e1a051d1e9d”,”width”:120},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=120&quality=45&auto=format&fit=max&dpr=2&s=c9bb54a6a6e8c7a594593cf3fe38798a”,”width”:240}]},{“weighting”:”supporting”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=380&quality=85&auto=format&fit=max&s=6a00a84e9d9061f2fa5b7db05bca70bc”,”width”:380},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=380&quality=45&auto=format&fit=max&dpr=2&s=7aa30c16ba1c98ef798ae2c4fcc555a6″,”width”:760},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=300&quality=85&auto=format&fit=max&s=fad03e6219c50fae73b53318201f91d7″,”width”:300},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=300&quality=45&auto=format&fit=max&dpr=2&s=19b4b29567d92496151a640959f307a9″,”width”:600},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”showcase”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=860&quality=85&auto=format&fit=max&s=98a35be39380a28c1dedb56e36cea78c”,”width”:860},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=860&quality=45&auto=format&fit=max&dpr=2&s=5f14f53e720eb86028cfe8745c47aa2b”,”width”:1720},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=780&quality=85&auto=format&fit=max&s=06818e61676b9c4eb933484553cb9a88″,”width”:780},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=780&quality=45&auto=format&fit=max&dpr=2&s=e612a6ec09d4e7d4b6724d7c9fda1161″,”width”:1560},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”halfwidth”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=85&auto=format&fit=max&s=1ebcb9a26a7674639d4d643a2aecc99c”,”width”:620},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=620&quality=45&auto=format&fit=max&dpr=2&s=12cd2b8d73d6ee39327162edf189a634″,”width”:1240},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=85&auto=format&fit=max&s=4aa8d1868317d947d8c855cb7fdb2d35″,”width”:605},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=605&quality=45&auto=format&fit=max&dpr=2&s=7af2d056b34aed02f34bb4a2b2b84369″,”width”:1210},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=85&auto=format&fit=max&s=ba90079d744c229dc88e75864ff0dd13″,”width”:445},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=445&quality=45&auto=format&fit=max&dpr=2&s=6b3ea31e94899c4fee3bdaf7b79790a6″,”width”:890}]},{“weighting”:”immersive”,”srcSet”:[{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1900&quality=85&auto=format&fit=max&s=0d3ea282ce58e800ad8f785252124927″,”width”:1900},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1900&quality=45&auto=format&fit=max&dpr=2&s=144ab69b8c1d5c91d4ba925b49574656″,”width”:3800},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1300&quality=85&auto=format&fit=max&s=63b1e191f30bb112a2e7078bc6cd4da7″,”width”:1300},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1300&quality=45&auto=format&fit=max&dpr=2&s=31b62f371e500785622ac05778928b47″,”width”:2600},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1140&quality=85&auto=format&fit=max&s=490144a7b822de9d969583cb5254695b”,”width”:1140},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=1140&quality=45&auto=format&fit=max&dpr=2&s=132859f73ea11a55726182924ba7bc79″,”width”:2280},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=980&quality=85&auto=format&fit=max&s=91f1a7c5704f8cfda20996bc4c98073d”,”width”:980},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=980&quality=45&auto=format&fit=max&dpr=2&s=bb7e8bda9ebba98f61359c740b199745″,”width”:1960},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=740&quality=85&auto=format&fit=max&s=9c110c51a5a1d9a11758e99aed8fe7ee”,”width”:740},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=740&quality=45&auto=format&fit=max&dpr=2&s=713b8f2cca3a9d2470c5c9896556855c”,”width”:1480},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=660&quality=85&auto=format&fit=max&s=192802f54e8171880b6c00e83afb3d08″,”width”:660},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=660&quality=45&auto=format&fit=max&dpr=2&s=af87253c8d48f1cfb9a06a792b58beed”,”width”:1320},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=480&quality=85&auto=format&fit=max&s=9ba52c5e99a9745fc5a35e53953b6ffd”,”width”:480},{“src”:”https://i.guim.co.uk/img/media/080ae797ef8655a710c3148f1895683e0ee290c2/0_0_1131_485/master/1131.jpg?width=480&quality=45&auto=format&fit=max&dpr=2&s=e6439ec989c8f4baaa0f4ef6a79c10d6″,”width”:960}]}],”elementId”:”8f8f0f61-f8d4-44ea-a55c-2011148d3158″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The decline is partly due to dollar strength – the greenback is at 20-year highs against a basket of currencies, due to worries about the global economy and the series of large interest rates by the US Federal Reserve.

“,”elementId”:”2557ed49-c4dc-4f51-a3a9-d6703efe652b”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

But it’s also due to concerns over the UK economy as it teeters towards recession.

“,”elementId”:”973eafc1-cedf-42c6-96f2-36e79e462cdf”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Investors are anxious that Kwarteng’s mini-budget will drive up borrowing – especially as the Office for Budget Responsibility has not been allowed to provide forecasts for today’s event.

“,”elementId”:”313a47f4-fec1-4224-a3fa-0cc10b761805″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

RBC Capital Markets say markets are left to speculate on “who has the appetite for gilts when the BoE is selling and the govt is ramping up borrowing at a dizzying pace”.

“,”elementId”:”e47e7880-47ec-4150-b6fc-3e77c6d26adb”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

They forecast that the pound could fall even lower, to below $1.05 – which would be an all-time low.

“,”elementId”:”e70969ed-5cff-4a31-acea-611152c0168a”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

For us, it leaves weaker GBP [the pound] as the clearest escape valve to keep financing a large current account deficit.

\n

Our forecast is currently sub-1.05 for GBP/USD. If the Chancellor’s gamble to boost growth fails to pay off, it will leave GBP in an even bigger hole.

\n

“,”elementId”:”5d3e6250-0c58-4217-9267-36ddb7df49b3″},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

Bracing start to mini Budget day – pound dips below $1.12 at one point touching new 37-year low pic.twitter.com/ufa1J0LUSa

— Paul Kelso (@pkelso) September 23, 2022

\n”,”url”:”https://twitter.com/pkelso/status/1573207875505340416″,”id”:”1573207875505340416″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”fac4dabb-e8d8-442d-a353-408ff28b042a”}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663916728000,”blockCreatedOnDisplay”:”08.05 BST”,”blockLastUpdated”:1663917919000,”blockLastUpdatedDisplay”:”08.25 BST”,”blockFirstPublished”:1663917540000,”blockFirstPublishedDisplay”:”08.19 BST”,”blockFirstPublishedDisplayNoTimezone”:”08.19″,”title”:”Pound hits 37-year low against dollar as UK ‘ramps up borrowing at a dizzying pace'”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”},{“id”:”632d586e8f0894f47d8a3b7d”,”elements”:[{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Simon Clarke, the Secretary of State for Levelling Up, has denied that the government’s fiscal plans are a gamble.

“,”elementId”:”726fad40-40bf-467e-9d72-a357da6fa5af”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

On this morning’s media rounds, Clarke told the BBC that tax cuts will spur economic growth that outstrips rising national debt.

“,”elementId”:”43e89370-6587-4c3b-821e-24dadf6c20fa”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“The evidence of the 1980s and the 1990s is that a dynamic low tax economy is what delivers the best growth rates – this isn’t a gamble, the weight of history and evidence is with us.”

\n

“,”elementId”:”e4c6cde0-8416-4c30-ab26-f04abcddb307″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Clarke also told Sky News that the budget will be a game-changer, and that growth will pay for the UK’s government spending plans

“,”elementId”:”b0c74a22-0fdf-4449-ad0d-ea9521c9aa97″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Asked if his view last year that some tax increases would be needed to repair government finances still applied, Clarke said:

“,”elementId”:”90705bef-8006-40fc-8046-76a9c60f0fff”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“No, because what you’re doing now is that you’re going for growth…

\n

The critical thing is we need to get the economy growing so that, frankly, the economic growth trajectory outstrips that of our debt.”

\n

“,”elementId”:”597b89ad-f432-4472-bb76-2f14d5851dc2″}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663916142000,”blockCreatedOnDisplay”:”07.55 BST”,”blockLastUpdated”:1663916759000,”blockLastUpdatedDisplay”:”08.05 BST”,”blockFirstPublished”:1663916759000,”blockFirstPublishedDisplay”:”08.05 BST”,”blockFirstPublishedDisplayNoTimezone”:”08.05″,”title”:”Minister: plans aren’t a gamble”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”},{“id”:”632d49d58f0822acf24f4e11″,”elements”:[{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Kwasi Kwarteng will on Friday announce 30 separate measures – including tax cuts, new investment zones and an acceleration of infrastructure projects – in an effort to raise the economy’s growth rate to his stated target of 2.5% a year.

“,”elementId”:”3ce2d369-4139-4fe0-838f-15eb6ba901d9″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

One of the main elements of the package – the £13bn reversal of the increase in national insurance contributions, introduced in April to fund the health and social care levy – will come into force on 6 November.

“,”elementId”:”3d06c8f4-9f5a-4862-a510-08c223d94799″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

While almost 28 million people will keep more of their earnings as a result of the move, the Resolution Foundation thinktank said on average the poorest 10% of households would gain £11.41 in 2022-23, while the richest 10% of households would gain £682.

“,”elementId”:”2c2924c4-0a40-455e-ac24-a1eb15df3f90″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The mini-budget is expected to contain significant further interventions to boost growth beyond the reversal of the NICs rise and next April’s planned increase in corporation tax, Treasury sources have confirmed, with one Whitehall source describing the package as having “more rabbits than Watership Down”.

One key plank of the fiscal event will be new investment zones for 38 local and mayoral authorities in England – including West Midlands, Tees Valley, Somerset and Hull – which will have major planning deregulation to release more land for housing and commercial development, and tax cuts for businesses.

“,”elementId”:”f2e3c49c-4b76-4279-abac-b7021a2803c3″},{“_type”:”model.dotcomrendering.pageElements.RichLinkBlockElement”,”url”:”https://www.theguardian.com/uk-news/2022/sep/22/uk-recession-interest-rate-hikes-bank-of-england-kwasi-kwarteng-tax-cut-mini-budget”,”text”:”UK in recession and further interest rate hikes probable, Bank warns Kwarteng”,”prefix”:”Related: “,”role”:”thumbnail”,”elementId”:”2910a1c5-8b5c-4aaa-b584-543e054c9c9d”}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663915246000,”blockCreatedOnDisplay”:”07.40 BST”,”blockLastUpdated”:1663915570000,”blockLastUpdatedDisplay”:”07.46 BST”,”blockFirstPublished”:1663915570000,”blockFirstPublishedDisplay”:”07.46 BST”,”blockFirstPublishedDisplayNoTimezone”:”07.46″,”title”:”Mini-budget: what we expect”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”},{“id”:”632d48dd8f0822acf24f4e06″,”elements”:[{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Good morning, and welcome to our rolling coverage of business, the world economy and the financial markets.

“,”elementId”:”ea93ccea-4bf6-44d1-84e0-4af7d4ce8e5d”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Consumers across the UK are the gloomiest on record as the economic picture darkens… as the government announces its plan to kick-start UK economic growth with a flurry of tax cuts that will drive up borrowing.

“,”elementId”:”f33ecd32-1bb7-4320-a7a3-9f2fcf0705f4″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

People are increasingly worried about their personal finances, and anxious that the economy is turning sour, research body GfK warns, a day after the Bank of England said the UK has probably entered recession this quarter.

“,”elementId”:”8839f7d8-c92c-4694-b195-8c46d8a79e8b”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

GfK’s long-running Consumer Confidence Index has fallen another five points this month to a new low of -49.

“,”elementId”:”eb304acb-44cc-4527-8b06-4c7b0b6d48f5″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

That’s the worst since records began in 1974, as the tightening squeeze on living costs made people much more pessimistic about their own finances.

“,”elementId”:”fe61b5e9-2fc9-4e8e-8bed-c3927df47925″},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

In September the GfK UK Consumer Confidence Index fell a further five points to -49, setting a new record low, with data having been collected every month since 1974. pic.twitter.com/20bPQO2Hkk

— David Edwards (@ScattClouds) September 23, 2022

\n”,”url”:”https://twitter.com/ScattClouds/status/1573195980866203648″,”id”:”1573195980866203648″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”222d7899-fc56-43b6-a25f-eabef886a5c1″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

This is the fourth new low in five months, as the economy has been battered by rising prices and weakening activity.

“,”elementId”:”f2c0ac1d-ef46-4575-a87f-912456b59d39″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Confidence in personal finances over the coming year shed nine points to -40, while confidence in the economy over the next 12 months lost eight points to -68, a really grim reading.

“,”elementId”:”109cb680-33e6-4bc4-b335-414240174e17″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

People are also very unwilling to buy big ticket items, as soaring inflation forces households to cut back.

“,”elementId”:”a6ff4711-30f2-4c87-b413-b9a4862e77a6″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

GfK client strategy director Joe Staton said:

“,”elementId”:”e159ce25-32c1-498b-9d92-1c71f7684db3″},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“Consumers are buckling under the pressure of the UK’s growing cost-of-living crisis driven by rapidly rising food prices, domestic fuel bills and mortgage payments.

\n

“They are asking themselves when and how the situation will improve.

\n

“,”elementId”:”199ae046-c2cc-424d-9109-0e27798d520d”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Kwasi Kwarteng will vow to break the UK’s “cycle of stagnation” today, by lowering the tax burden in a hotly awaited mini budget..

“,”elementId”:”8633079c-4606-4f66-9a24-50be7f74a4f9″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

He’s expected to tell MPs that Britain needs a new approach, ‘focused on growth’, by saying:

“,”elementId”:”d503cc5b-decf-47ef-8383-e5adc76943e5″},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

“Growth is not as high as it needs to be, which has made it harder to pay for public services, requiring taxes to rise.

\n

“This cycle of stagnation has led to the tax burden being forecast to reach the highest levels since the late 1940s.

\n

“,”elementId”:”782af03a-fd87-40b7-ab76-476db806e245″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Even though today’s statement is officially only a ‘fiscal event’, it’s expected to include a 30-point growth package, including scrapping a planned increase in corporation tax from 19% to 25%, plus reforms to the City of London, ending the cap on bankers’ bonuses, and plans to create up 38 new Investment Zones across England.

“,”elementId”:”93cedc8c-8ed3-429c-8a27-7cbd8bfb0642″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Yesterday Kwarteng said the national insurance increase introduced earlier this year will be reversed from 6 November.

“,”elementId”:”8782c2c3-5acc-423d-becf-741c3f3efab0″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

But economists are warning tht the plan will drive UK borrowing sharply higher, just as government borrowing costs are rising in the bond markets.

“,”elementId”:”78738fc5-44d8-4cd0-a522-a7eca3af5ec8″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The Institute for Fiscal Studies warned this week that Britain’s mounting debts will be unsustainable if the government presses ahead with sweeping tax cuts.

“,”elementId”:”a9776195-21ad-4b59-a64b-13b99541226c”},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

Even once the substantial Energy Price Guarantee has expired in October 2024, borrowing could still run at about £100 billion a year in the mid-2020s.

This is more than £60 billion a year higher than the @OBR_uk forecast in March.

[6/13] pic.twitter.com/iZNk5dKQxw

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

\n”,”url”:”https://twitter.com/TheIFS/status/1572632518570004480″,”id”:”1572632518570004480″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”1d6e9e6c-2631-45f8-b72f-3752b7be2a2c”},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

Persistent current budget deficits and rising debt as a share of national income would mean that the two main fiscal targets legislated only in January would be missed.

Even once the Energy Price Guarantee has expired, debt would be left on an ever-increasing path.
[9/13] pic.twitter.com/UuSf6BpXMU

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

\n”,”url”:”https://twitter.com/TheIFS/status/1572632526862024704″,”id”:”1572632526862024704″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”a1c3d282-6462-4dcf-a791-12887f57cb18″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

GfK’s Staton points out that today’s mini-budget, and the longer-term agenda to drive the economy, are a major opportunity to improve the economic outlook.

“,”elementId”:”8ce5ea04-6b38-47da-8358-3099fb79f54f”},{“_type”:”model.dotcomrendering.pageElements.BlockquoteBlockElement”,”html”:”

\n

It will also be a major test for the popularity of Liz Truss’s new Government.”

\n

“,”elementId”:”1849864d-d223-40bc-9242-f9c39d5f70b3″},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

UK Consumers Fear for Their Future as Living Standards Plummet
Low st consumer confidence figures since Gfk started compiling survey in 1970s. https://t.co/eykHu9uNLL

— Louise Cooper (@Louiseaileen70) September 23, 2022

\n”,”url”:”https://twitter.com/Louiseaileen70/status/1573195325837303809″,”id”:”1573195325837303809″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”9c073c0a-93c1-4256-9e59-9e5ce26ee3c0″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

We also find out today how manufacturing and services companies in the UK, the US, and across the eurozone, are faring this month – and get a healthcheck on Britain’s retail sector.

“,”elementId”:”601884ff-54a0-4dba-9157-73e728a45b75″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

Financial markets are subdued, as investors worry that interest rate hikes by central bankers are pushing major economies towards recession.

“,”elementId”:”51054229-24dd-4b0d-a772-9a7b319ac73f”},{“_type”:”model.dotcomrendering.pageElements.TweetBlockElement”,”html”:”

European Opening Calls:#FTSE 7157 -0.03%#DAX 12531 -0.01%#CAC 5922 +0.06%#AEX 655 -0.35%#MIB 21726 -0.34%#IBEX 7762 -0.16%#OMX 1837 -0.07%#SMI 10290 -0.08%#STOXX 3426 -0.03%#IGOpeningCall

— IGSquawk (@IGSquawk) September 23, 2022

\n”,”url”:”https://twitter.com/IGSquawk/status/1573172721978339328″,”id”:”1573172721978339328″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”857db97a-1b25-4157-a983-1cff14a62a32″},{“_type”:”model.dotcomrendering.pageElements.SubheadingBlockElement”,”html”:”

The agenda

“,”elementId”:”39ea9029-a932-48f3-8cee-ac0b66f0d942″},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

    \n

  • 9am BST: Eurozone flash PMIs for September

  • \n

  • 9.30am BST: UK flash PMIs for September

  • \n

  • 9.30am BST: Chancellor Kwasi Kwarteng presents mini-budget

  • \n

  • 11am BST: CBI Distributive trends survey of UK retailers

  • \n

“,”elementId”:”8d5b363f-af2b-4998-b660-ab5f6f931586″}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1663915246000,”blockCreatedOnDisplay”:”07.40 BST”,”blockLastUpdated”:1663915522000,”blockLastUpdatedDisplay”:”07.45 BST”,”blockFirstPublished”:1663915246000,”blockFirstPublishedDisplay”:”07.40 BST”,”blockFirstPublishedDisplayNoTimezone”:”07.40″,”title”:”Introduction: UK consumers fear for the future as living standards slide”,”contributors”:[],”primaryDateLine”:”Fri 23 Sep 2022 08.25 BST”,”secondaryDateLine”:”First published on Fri 23 Sep 2022 07.40 BST”}],”filterKeyEvents”:false,”id”:”key-events-carousel-mobile”}”>

filters BETA

Pound hits 37-year low against dollar as UK ‘increases lending at breakneck pace’

The British pound has fallen to a new 37-year low against the US dollar, an unwelcome backdrop to the Kwasi Kwarteng mini-budget this morning.

The pound has fallen below $1.12, the weakest point since 1985, and is now down 17% against the dollar so far this year.

The pound against the US dollar
The pound against the US dollar Photography: Refinitive

The drop is due in part to the strength of the dollar: the dollar is at a 20-year high against a basket of currencies, due to concerns about the global economy and the series of high interest rates from the US Federal Reserve. USA

But it is also due to concerns about the UK economy, which is teetering towards recession.

Investors are anxious that Kwarteng’s mini-budget will increase borrowing, especially as the Office for Budget Responsibility has been unable to provide forecasts for today’s event.

RBC Capital Markets they say markets are left to speculate on “who has an appetite for gilts when the BoE is selling and the government is increasing lending at a breakneck pace”.

They forecast that the pound could fall further, below $1.05, which would be an all-time low.

For us, it leaves a weaker GBP [the pound] as the clearest escape valve to continue financing a large current account deficit.

Our forecast is currently below 1.05 for GBP/USD. If the Chancellor’s gamble to boost growth doesn’t pan out, it will leave GBP in an even bigger hole.

Bracing start to mini Budget day – pound dips below $1.12 at one point touching new 37-year low pic.twitter.com/ufa1J0LUSa

— Paul Kelso (@pkelso) September 23, 2022

\n”,”url”:”https://twitter.com/pkelso/status/1573207875505340416″,”id”:”1573207875505340416″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”0cb38643-9fe0-471c-8e73-b7c1b38f84cb”}}”/>

Minister: the plans are not a bet

Simon Clarke, the Secretary of State for Leveling Up, has denied that the government’s fiscal plans are gambling.

At the press rounds this morning, Clarke told the BBC that tax cuts will spur economic growth that outweighs the growing national debt.

“The evidence from the 1980s and 1990s is that a dynamic, low-tax economy is what offers the best growth rates; This is not a gamble, the weight of history and evidence is with us.”

Clarke also said sky news that the budget will be a game changer and that growth will pay for UK government spending plans

Asked if his view from last year that some tax increases would be needed to repair the government’s finances still applied, Clarke said:

“No, because what you are doing now is that you are going for growth…

The bottom line is that we need to grow the economy so that, frankly, the trajectory of economic growth exceeds that of our debt.”

Here are more details of the drop in consumer confidence this month:

UK consumer confidence
UK consumer confidence Photography: GfK

UK @GfK consumer confidence drops to another all-time low (records started in 1974) 👇

Maybe most concerning aspect: GfK recorded no change to responses after Sept 8 (Truss cost-of-living statement).

Kwarteng has a job on his hands to bolster confidence.https://t.co/tablpx3quN pic.twitter.com/aSorThIs7Q

— Andy Bruce (@BruceReuters) September 23, 2022

\n”,”url”:”https://twitter.com/BruceReuters/status/1573199441494179841″,”id”:”1573199441494179841″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”0a85cee5-373e-4a58-92e4-c9be588e8983″}}”/>

Paul Johnson, Director of IFS has calculated that the mini-budget could be the largest tax-cutting fiscal event since Nigel Lawson’s 1988 Budget.

If Mr Kwarteng does nothing other than reverse NI increase and stop legislated rise in corporation tax, tomorrow's will be the biggest tax cutting fiscal event since Nigel Lawson's famous 1988 budget.

Even though this is not a Budget.

Long way to go to match Barber though… pic.twitter.com/HZB6LXg383

— Paul Johnson (@PJTheEconomist) September 22, 2022

\n”,”url”:”https://twitter.com/PJTheEconomist/status/1572864722025709568″,”id”:”1572864722025709568″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”aa5d0ca8-a57a-48d5-a556-0abc3b653936″}}”>

If Mr. Kwarteng does nothing more than reverse the NI increase and stop the legislated corporate tax increase, tomorrow’s will be the biggest fiscal tax cut event since Nigel Lawson’s famous 1988 budget.

Although this is not a budget.

However, there is still a long way to go to match Barber… pic.twitter.com/HZB6LXg383

—Paul Johnson (@PJTheEconomist) September 22, 2022

Mini-budget: what we expect

Kwasi Kwarteng will announce 30 separate measures on Friday, including tax cuts, new investment zones and a speed-up of infrastructure projects, in an effort to lift the economy’s growth rate to its stated target of 2.5% a year.

One of the main elements of the package, the £13bn reversal of the increase in national insurance contributions, introduced in April to fund the health and social care levy, will come into force on November 6.

While nearly 28 million people will keep more of their earnings as a result of the move, the Resolution Foundation think tank said that on average the poorest 10% of households would earn £11.41 in 2022. 23, while the richest 10% of households would earn £682.

The mini-budget is expected to contain significant additional interventions to boost growth beyond the reversal of the NIC increase and the planned rise in corporate tax next April, Treasury sources confirmed, with a Whitehall source describing the package has “more rabbits than Watership Down”. ”.

A key element of the fiscal event will be new investment zones for 38 local authorities and mayors in England, including the West Midlands, Tees Valley, Somerset and Hull, which will have major planning deregulation to free up more land for housing and commercial development, and taxes. cuts for companies.

Introduction: UK consumers fear for the future as living standards decline

Good morning and welcome to our ongoing coverage of business, the world economy and the financial markets.

Consumers across the UK are the most pessimistic on record as the economic outlook darkens… as the government announces its plan to boost UK economic growth with a series of debt-boosting tax cuts.

People are increasingly worried about their personal finances and anxious that the economy is deteriorating, according to a research body. GfK warns, a day after the Bank of England said the UK has probably entered a recession this quarter.

GfK’s long-running consumer confidence index has fallen another five points this month to a new low of -49.

That’s the worst since records began in 1974, as the falling cost of living made people much more pessimistic about their own finances.

In September the GfK UK Consumer Confidence Index fell a further five points to -49, setting a new record low, with data having been collected every month since 1974. pic.twitter.com/20bPQO2Hkk

— David Edwards (@ScattClouds) September 23, 2022

\n”,”url”:”https://twitter.com/ScattClouds/status/1573195980866203648″,”id”:”1573195980866203648″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”801ff6a1-eca3-4253-baa8-5e7f99e332de”}}”>

In September, the GfK UK Consumer Confidence Index fell a further five points to -49, setting a new all-time low, with data collected every month since 1974. pic.twitter.com/20bPQO2Hkk

—David Edwards (@ScattClouds) September 23, 2022

This is the fourth new low in five months as the economy has been hit by rising prices and weakening activity.

Confidence in personal finances over the next year lost nine points to -40, while confidence in the economy over the next 12 months lost eight points to -68, a really gloomy reading.

People are also unwilling to buy expensive items as rising inflation forces households to cut back.

GfK Client Strategy Director Joseph Staton said:

“Consumers are caving in under the pressure of the UK’s growing cost of living crisis driven by rapidly rising food prices, household fuel bills and mortgage payments.

“They wonder when and how the situation will improve.

Kwasi Kwarteng promises to break the UK’s “cycle of stagnation” today, by reducing the tax burden in a long-awaited mini-budget.

He is expected to tell MPs that Britain needs a new, ‘growth-focused’ approach, saying:

“Growth is not as high as it should be, which has made it difficult to pay for public services, which has forced higher taxes.

“This cycle of stagnation has led to the tax burden being forecast to reach the highest levels since the late 1940s.

Although today’s declaration is officially only a ‘fiscal event’, it is expected to include a 30-point growth package, including the removal of a planned increase in corporate tax from 19% to 25%, in addition to reforms in the City of London, ending the cap. on bankers’ bonuses and plans to create 38 new investment zones across England.

Yesterday, Kwarteng said that the national insurance increase introduced earlier this year will be reversed from November 6.

But economists warn the plan will cause UK borrowing to rise sharply, just as government borrowing costs are rising in bond markets.

The Institute for Fiscal Studies warned this week that Britain’s mounting debts will be unsustainable if the government goes ahead with tax cuts.

Even once the substantial Energy Price Guarantee has expired in October 2024, borrowing could still run at about £100 billion a year in the mid-2020s.

This is more than £60 billion a year higher than the @OBR_uk forecast in March.

[6/13] pic.twitter.com/iZNk5dKQxw

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

\n”,”url”:”https://twitter.com/TheIFS/status/1572632518570004480″,”id”:”1572632518570004480″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”16256686-2e81-4fba-8cb4-0e88989cf02c”}}”>

Even once the substantial power price guarantee has expired in October 2024, lending could still be around £100bn a year by the mid-2020s.

This is over £60 billion a year more than the @OBR_es Forecast in March.

[6/13] pic.twitter.com/iZNk5dKQxw

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

Persistent current budget deficits and rising debt as a share of national income would mean that the two main fiscal targets legislated only in January would be missed.

Even once the Energy Price Guarantee has expired, debt would be left on an ever-increasing path.
[9/13] pic.twitter.com/UuSf6BpXMU

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

\n”,”url”:”https://twitter.com/TheIFS/status/1572632526862024704″,”id”:”1572632526862024704″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”1a7b0201-993a-474e-ab2f-ef846728d6ee”}}”>

The current persistent budget deficits and the increase in debt as a percentage of national income would mean that the two main fiscal objectives legislated only in January would not be met.

Even once the energy price guarantee has expired, the debt would remain on an ever-increasing path.
[9/13] pic.twitter.com/UuSf6BpXMU

— Institute for Fiscal Studies (@TheIFS) September 21, 2022

by GfK Staton points to today’s mini-budget and longer-term agenda to boost the economy as a great opportunity to improve the economic outlook.

It will also be an important test for the popularity of the new government of Liz Truss”.

UK Consumers Fear for Their Future as Living Standards Plummet
Low st consumer confidence figures since Gfk started compiling survey in 1970s. https://t.co/eykHu9uNLL

— Louise Cooper (@Louiseaileen70) September 23, 2022

\n”,”url”:”https://twitter.com/Louiseaileen70/status/1573195325837303809″,”id”:”1573195325837303809″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”efb770c6-0408-4741-8ec3-d8bac7507c95″}}”>

UK consumers fear for their future as living standards plummet
Low consumer confidence figures since Gfk started collecting surveys in the 1970s. https://t.co/eykHu9uNLL

— Louise Cooper (@Louiseaileen70) September 23, 2022

We also find out today how manufacturing and service companies are doing this month in the UK, US, and China.

Financial markets are dovish as investors worry that interest rate hikes by central bankers are pushing major economies into recession.

European Opening Calls:#FTSE 7157 -0.03%#DAX 12531 -0.01%#CAC 5922 +0.06%#AEX 655 -0.35%#MIB 21726 -0.34%#IBEX 7762 -0.16%#OMX 1837 -0.07%#SMI 10290 -0.08%#STOXX 3426 -0.03%#IGOpeningCall

— IGSquawk (@IGSquawk) September 23, 2022

\n”,”url”:”https://twitter.com/IGSquawk/status/1573172721978339328″,”id”:”1573172721978339328″,”hasMedia”:false,”role”:”inline”,”isThirdPartyTracking”:false,”source”:”Twitter”,”elementId”:”e20972d7-45c7-4f21-a4fc-e155b79a3975″}}”/>

The agenda

  • 9am BST: Eurozone fast PMI for September

  • 9.30am BST: UK Flash PMI for September

  • 9:30am BST: Foreign Minister Kwasi Kwarteng unveils mini-budget

  • 11am BST: CBI Distributional Trends Survey of UK Retailers

Leave a Reply

Your email address will not be published.