The former chancellor has tried to project his financial nous and attention to detail as reasons the public can trust him to bring down both price growth and the Bank of England’s base rate.
Mr Sunak made his primary pledge at the start of 2023 to “halve inflation” from just over 10% to around 5% by the end of the year.
Speaking from the warehouse, Mr Sunak said: “Yesterday you would have heard some news about inflation, today you may have seen what the Bank of England has announced with interest rates.
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“I’m sure that actually fills many of you with some anxiety and some concern about what’s going on and what that means for you and your families.
“I’m here to tell you that I am totally, 100%, on it and it’s going to be OK and we are going to get through this.”
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Asked by Sky News if he accepted that his approach to the economy – keeping public pay low, shying away from tax cuts and promising to halve inflation – would hurt his electoral chances, Mr Sunak remained stoic.
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11:04
How will we control inflation?
He said that meeting his target has “of course” got harder, “but it’s certainly not impossible”.
The prime minister said that public will be able to judge him in “six months, nine months, a year” on how he is doing and whether the economy is healthier.
Earlier in the day, he said that halving inflation by the end of year is “hard but not impossible”.
Mr Sunak was speaking to the Times CEO summit shortly after the surprise hiking of interest rate.
Mr Sunak said: “Clearly what’s happened in the last couple of months makes that harder, of course it does. That goes without saying. But I’ve always said this would be hard.
“It’s clearly become more challenging and it’s clearly become harder, but it’s not impossible and we’re throwing absolutely everything at it, and that’s what I’m doing.”
He said earlier that “clearly it’s got harder over the past few months” to bring down inflation.
Interest rates are set by the bank independently of the government and impact the cost of borrowing money, while inflation charts how quickly prices are rising.
Image: Rishi Sunak and Andrew Bailey. Pic: Twitter/Rishi Sunak
Speaking to journalists during the daily briefing, the prime minister’s spokesman said Mr Bailey still had Rishi Sunak’s support.
He was repeatedly asked if the central bank chief was doing a good job in tackling inflation, but did not respond in the affirmative.
This took place shortly before the surprise interest rate hike.
The Number 10 spokesman said: “The prime minister thinks it is important that we continue to support the bank in the work they are doing.
“You’re aware that there’s an independent process for setting interest rates, and we continue to work closely with them and work well with them to bring down inflation.”
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Hamas’s armed group has claimed it has lost contact with two hostages as a result of Israel’s operations in Gaza – after it called on air deployments to be stopped for 24 hours.
In a statement, Hamas’s armed al-Qassam Brigades said it had demanded that Israel halt air sorties for 24 hours, starting at 6pm, in part of Gaza City, to remove the hostages from danger.
It comes a day before Israeli Prime Minister Benjamin Netanyahu is due to meet US President Donald Trump and as the number of those killed in Gaza surpasses the 66,000 mark, according to the enclave’s Hamas-run health ministry.
Its figure does not differentiate between civilians and fighters.
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3:06
Volunteer nurse’s video diary of Gaza horrors
A total of 48 hostages are still being held captive by Hamas, the militant group which rules Gaza, with about 20 believed by Israel to still be alive. A total of 251 hostages were taken on 7 October 2023, when Hamas launched an unprecedented attack on Israel which killed 1,200 people.
Situation on the ground
In Gaza, a war-torn enclave where famine has been declared in some areas and where Israel has been accused of committing acts of genocide – which it has repeatedly denied – the almost two-year war raged on.
On Sunday, the number of those killed rose to at least 21 as five people were killed in an airstrike in the Al Naser area, local health authorities said, while medics reported 16 more deaths in strikes on houses in central Gaza.
The Civil Emergency Service in Gaza said late on Saturday that Israel had denied 73 requests, sent via international organisations, to rescue injured Palestinians in Gaza City.
Israeli authorities had no immediate comment. The military earlier said forces were expanding operations in the city and that five militants firing an anti-tank missile towards Israeli troops had been killed by the Israeli air force.
In Monday’s White House meeting, President Trump is expected to share a new 21-point proposal for an immediate ceasefire.
His proposal would include the release of all hostages within 48 hours and a gradual withdrawal of Israeli forces from the Palestinian enclave, according to three Arab officials briefed on the plan, the PA news agency reports.
A Hamas official said the group was briefed on the plan but has yet to receive an official offer from Egyptian and Qatari mediators. Hamas has said it is ready to “study any proposals positively and responsibly”.
Mr Trump, who has been one of Israel’s greatest allies, said on Sunday there is “a real chance for greatness in the Middle East”.
It is unclear, however, what Mr Trump was specifically referring to.
He said in a Truth Social post: “We have a real chance for Greatness in the Middle East. All are on board for something special, first time ever. We will get it done.”
On Friday – the same day a video of diplomats walking out on Mr Netanyahu during his address to the United Nations went viral – Mr Trump said he believed the US had reached a deal on easing fighting in Gaza, saying it “will get the hostages back” and “end the war”.
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1:08
Diplomats walk out as Israeli PM speaks at UN
“I think we maybe have a deal on Gaza, very close to a deal on Gaza,” the US president told reporters on the White House lawn as he was leaving to attend the Ryder Cup.
Mr Trump has repeatedly claimed an agreement to end the war was imminent, only for nothing to materialise.
Weeks ago, he said: “I think we’re going to have a deal on Gaza very soon.”
It was one sentence among the many words Donald Trump spoke this week that caught my attention.
Midway through a jaw-dropping news conference where he sensationally claimed to have “found an answer on autism”, he said: “Bobby (Kennedy) wants to be very careful with what he says, but I’m not so careful with what I say.”
The US president has gone from pushing the envelope to completely unfiltered.
Last Sunday, moments after Charlie Kirk‘s widow Erika had publicly forgiven her husband’s killer, Mr Trump told the congregation at his memorial service that he “hates his opponents”.
Image: President Donald Trump embraces Charlie Kirk’s widow Erika. Pic: AP
The president treats professional disapproval not as a liability but as evidence of authenticity, fuelling the aura that he is a challenger of conventions.
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“I’m really good at this stuff. Your countries are going to hell,” he told his audience, deriding Europe’s approach to immigration as a “failed experiment of open borders”.
Image: Mr Trump addresses the UN General Assembly in New York. Pic: Reuters
Then came a U-turn on Ukraine, suggesting the country could win back all the land it has lost to Russia.
Most politicians would be punished for inconsistency, but Mr Trump recasts this as strategic genius – framing himself as dictating the terms.
It is hard to keep track when his expressed hopes for peace in Ukraine and Gaza are peppered with social media posts condemning the return of Jimmy Kimmel to late-night television.
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2:29
Trump’s major shift in Ukraine policy
Perhaps most striking of all is his reaction to the indictment of James Comey, the FBI director he fired during his first term.
In theory, this should raise questions about the president’s past conflicts with law enforcement, but he frames it as vindication, proof that his enemies fall while he survives.
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0:49
Ex-FBI chief: ‘Costs to standing up to Trump’
Mr Trump has spent much of his political career cultivating an image of a man above the normal consequences of politics, law or diplomacy, but he appears to feel more invincible than ever.
Russia has launched a massive drone attack on Ukraine’s capital this morning, injuring at least six people, Kyiv’s military administration has said.
Poland closed the airspace near two of its southeastern cities, Lublin and Rzeszow, as its air force scrambled jets in response to Russia’s attack on Kyiv.
Drones flew over Kyiv and anti-aircraft fire rang out through the night in what independent monitors said was one of the biggest strikes on the city since the Ukraine war began in February 2022.
The attack started at around 6am local time and many regions across the country are under air raid alert.
Some residents have fled to metro stations deep underground for safety as the attack continues.
Poland said it had closed its airspace near the two cities until at least 4am GMT due to “unplanned military activity related to ensuring state security”, flight tracking service Flightradar24 said.
“In connection with the activity of the Russian Federation’s long-range aviation carrying out strikes on the territory of Ukraine, Polish and allied aircraft have begun operating in our airspace,” the military said in a post on X.
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It described the actions as preventive and aimed at securing airspace and protecting citizens.
It comes as Russian foreign minister Sergei Lavrov was expected to address allegations made against Moscow that it has violated the airspace of several of its neighbours in recent weeks, as he spoke in New York at the 80th UN General Assembly.
During his address, Mr Lavrov, who has been Russia’s foreign minister for 21 years, says his country had no intention of attacking any NATO or EU member state but warned of a “decisive response” if any “aggression” was directed towards Moscow.
This breaking news story is being updated and more details will be published shortly.