Liz Truss refuses to apologise for sparking mortgage rate rise – but admits one failing as PM

Published

12 months ago

April 21, 2024

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Liz Truss has acknowledged she and her government lost the confidence of financial markets following the mini-budget of October 2022 – but has refused to apologise to homeowners for higher interest rates.

Talking to Sky News, the former prime minister blamed her downfall on the Bank of England, primarily governor Andrew Bailey. However, she said she did not meet Mr Bailey once during her time in office.

“I actually had a meeting set up – I wanted to meet him,” she said. “But I was advised that would be a bad idea. And perhaps I shouldn’t have taken that advice.

“But that advice came from the cabinet secretary and what I didn’t want to do is further exacerbate the [market] problems.

“In retrospect, yes, I probably should have spoken directly to the governor of the Bank of England at the time.”

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Asked about the aftermath of the mini-budget, at which her chancellor Kwasi Kwarteng announced a series of unfunded tax cuts, without presenting evidence of how he would pay for them, Ms Truss said: “It’s fair to say that the government did not have the confidence of the markets…

“But if you have organisations within the state, like the Bank of England, like the Office of Budget Responsibility, who are pretty clear to people they don’t support the policies that are being pursued and are essentially undermining those policies, then it is difficult to command the confidence in the markets – because the markets look to the government for that leadership.”

During Ms Truss’s short time in office, the expected path for the Bank’s interest rate a year ahead rose from below 4% to around 6%.

While those rates were increasing before the fiscal event, they shot up dramatically in the wake of the mini-budget, rising even further when, a few days later, Mr Kwarteng promised even more tax cuts.

That sharp increase in interest rates precipitated a short-lived crisis in UK financial markets, which triggered the near collapse of liability-driven investment (LDI) funds which underlie the pension market.

Asked whether she would apologise for the sharp rise in interest rates during her time in office, Ms Truss said: “I question the premise of what you’re asking me, because mortgage rates have gone up across the world.

“The issues that I faced in office, were issues of not being able to deliver the agenda because of a deep resistance within the establishment.”

She continued: “I think it’s wrong to suggest that I’m responsible for British people paying higher mortgages. That is something that has happened in every country in the free world.

“I’m not saying that I got everything absolutely perfect in the way the policy was communicated. But what I am saying is I faced real resistance and actions by the Bank of England that undermine my policy and created the problems in the market.”

Ms Truss was talking to Sky News in Washington DC on the US leg of her publicity tour for her new book, Ten Years To Save the West.

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Since publication it has emerged that one of the quotes she used in the book, attributed to Mayer Amschel Rothschild, is in fact a fake quote, often used in an antisemitic context.

Ms Truss said: “I’m very sorry about that. It was a complete mistake. It was something I found online and I’ve said I’m very sorry to the British Board of Deputies for that.

“It will be removed from all future editions of the book and removed from the Online Edition.”

Asked whether she feels more at home in the US than in the UK these days, she said: “Well, I do like aspects of American politics. I believe that on economics the US has got it more right than the UK has.

“My heart’s in Britain. But I think you’ve got to be prepared to learn from other countries that have that success.”

You can watch the full interview with the former prime minister on Sky News’s Sunday Morning with Trevor Phillips programme from 8.30am this morning. Trevor is also joined by Energy Security and Net Zero Secretary Claire Coutinho, shadow justice secretary Shabana Mahmood and Reform UK leader Richard Tice.

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Crypto stocks down, IPOs punted amid tariff tumult

Published

2 hours ago

April 4, 2025

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Crypto stocks down, IPOs punted amid tariff tumult

Cryptocurrency firms felt the heat from US President Donald Trump’s sweeping tariff rollout this week as market turbulence sent share prices tumbling and foiled initial public offering (IPO) plans.

From exchanges to Bitcoin (BTC) miners, crypto stocks suffered as much, if not more, than shares of other companies — despite the industry’s warm relationship with the US president.

On April 2, Trump announced he was placing tariffs of at least 10% on practically all imports into the United States and adding additional “reciprocal” tariffs on some 57 countries.

Since then, major US stock indices — including the S&P 500 and Nasdaq — tumbled by roughly 10% as traders braced for a looming trade war.

Sharp selloffs

Crypto exchange Coinbase — a prominent ally of Trump during the November US elections — experienced a similarly severe sell-off, with its stock price dropping by roughly 12% during the same period, according to data from Google Finance.

Bitcoin miners are also taking a hit. The CoinShares Crypto Miners ETF (WGMI) — which tracks a diverse basket of Bitcoin mining stocks — has lost roughly 13% of its value since immediately prior to Trump’s April 2 announcement, according to data from Morningstar.

Even Strategy, one of the best-performing stocks of 2024, wasn’t immune. Its share price has fallen by around 6% on the news, Google Finance data showed.

According to Reuters, investment bank JPMorgan has raised its estimated odds of a global economic recession in 2025 to 60% from 40% previously.

“Disruptive U.S. policies have been recognized as the biggest risk to the global outlook all year,” JP Morgan reportedly said.

“The effect … is likely to be magnified through (tariff) retaliation, a slide in U.S. business sentiment and supply-chain disruptions.”

IPO delays

The impact of US tariffs hasn’t been limited to stock price volatility. Stablecoin issuer Circle has reportedly paused plans for a 2025 IPO, citing market turbulence.

According to The Wall Street Journal, Circle is “waiting anxiously” before taking further steps after filing to take the company public on April 1.

It is among several companies — including fintech Klarna and ticketing service StubHub — reportedly considering altering or shelving IPO plans.

One exception may be Bitcoin itself, which some analysts say is finally “decoupling” from the broader market.

Bitcoin’s spot price has held above $82,000 this week, even as US equities markets collapsed.

Magazine: Unstablecoins: Depegging, bank runs and other risks loom

Politics

Brazilian court authorizes crypto seizure for debt collection — Report

Published

2 hours ago

April 4, 2025

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Brazilian court authorizes crypto seizure for debt collection — Report

Brazilian judges have been authorized to seize cryptocurrency assets from debtors who owe money and are behind on their payments, signaling a growing recognition that digital assets can be both a form of payment and a store of value.

According to local media reports, the Third Panel of Brazil’s Superior Court of Justice unanimously authorized judges to send letters to cryptocurrency brokers informing them about their intent to seize an account holder’s assets to repay creditors.

The report was confirmed by the Superior Court of Justice, which issued a notice on its website.

The decision was reached unanimously by the Third Panel, which reviewed a case brought forward by a creditor.

“Although they are not legal tender, crypto assets can be used as a form of payment and as a store of value,” a translated version of the Superior Court of Justice’s memo read.

Under existing rules, Brazilian judges are allowed to freeze bank accounts and order fund withdrawals, even without a debtor’s knowledge, should they rule that a creditor is owed money.

Following the recent decision, crypto assets now fall under the same purview.

Minister Ricardo Villas Bôas Cueva, who voted in the five-person panel, said cryptocurrencies still lack formal regulation in Brazil but noted certain bills have recognized the asset class as “a digital representation of value.”

Despite regulatory uncertainty, Brazil is a major hub for crypto

Although Brazil still lacks an overarching framework for digital assets, with the country’s central bank divvying up the regulatory processes into phases, crypto adoption is surging across the country.

Brazil ranks second among all Latin American countries in terms of “crypto value received,” which is a key benchmark for adoption, according to an October report by Chainalysis.

Earlier this year, crypto exchange Binance was granted approval to operate in the country after it acquired a São Paulo-based investment company.

A Binance executive told Cointelegraph at the time that Brazil was making “significant strides” in regulating the industry and expects a comprehensive framework to be finalized “by mid-year.”

Nevertheless, not all of Brazil’s regulatory proposals have been favorable for the industry.

In December, the country’s central bank proposed banning stablecoin transactions on self-custodial wallets at a time when more locals were using dollar-pegged tokens to hedge against the devaluation of the Brazilian real.

Industry observers told Cointelegraph at the time that such a ban would be difficult to enforce.

“Governments can regulate centralized exchanges, but P2P transactions and decentralized platforms are much harder to control, which means the ban would likely only affect part of the ecosystem,” said Lucien Bourdon, an analyst with Trezor.

Politics

‘Will the PM side with parents or tech bros?’: Labour peer demands action on children’s smartphone safety

Published

3 hours ago

April 4, 2025

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'Will the PM side with parents or tech bros?': Labour peer demands action on children's smartphone safety

Sir Keir Starmer needs to choose between parents who want stronger action to tackle harmful content on children’s phones, or the “tech bros” who are resisting changes to their platforms, Baroness Harriet Harman has said.

Speaking to Beth Rigby on Sky News’ Electoral Dysfunction podcast, the Labour peer noted that the prime minister met with the creators of hit Netflix drama Adolescence to discuss safety on social media, but she questioned if he is going to take action to “stop the tech companies allowing this sort of stuff” on their platforms where children can access it.

Sir Keir hosted a roundtable on Monday with Adolescence co-writer Jack Thorne and producer Jo Johnson to discuss issues raised in the series, which centres on a 13-year-old boy arrested for the murder of a young girl, and the rise of incel culture.

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The aim was to discuss how to prevent young boys being dragged into a “whirlpool of hatred and misogyny”, and the prime minister said the four-part series raises questions about how to keep young people safe from technology.

Sir Keir has backed calls for the four-part drama to be shown in all schools across the country, but Baroness Harman questioned what is going to be achieved by having young people simply watch the show.

“Two questions were raised [for me],” she said. ” Firstly – after they’ve watched it, what is going to be the discussion afterwards?

“And secondly, is he going to act to stop the tech companies allowing this sort of stuff to go online into smartphones without protection of children?

“Because if the tech companies wanted to do this, they could actually protect children. They can do everything they want with their tech.”

She acknowledged there are “very big public policy challenges” in this area, but added of the prime minister: “Is he going to side with parents who are terrified and want this content off their children’s phones, or is he going to accept the tech bros’ resistance to having to make changes?”

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Can parliament keep up?

The Labour peer backed the Conservative Party’s call for a ban on smartphones in schools to be mandated from Westminster, saying it would “enable all schools not to have a discussion with their parents or to battle it out, but just to say, this is the ruling” from central government, which Ofsted would then enforce.

“I’m sensitive to the idea that we shouldn’t constantly be telling schools what to do,” she continued. “And they’ve got a lot of common sense and a lot of professional experience, and they should have as much autonomy as possible.

“But perhaps it’s easier for them if it’s done top down.”

Baroness Harman also questioned the speed with which parliament is actually able to legislate to deal with the very rapid development of new technologies, and posits that it could “change its processes to be able to legislate in real time”.

She suggested that a “powerful select committee” of MPs could be established to do that, because “otherwise we talk about it, and then we’re not able to legislate for 10 years – by which time that problem has really set in, and we’ve got a whole load more problems”.

On the podcast, the trio also discussed the 10% tariffs imposed on the UK by Donald Trump and the government’s efforts to strike a trade deal with the US to mitigate the impact of the levy.

The government has refused to rule out scrapping the Digital Services Tax, a 2% levy on tech giants’ revenues in the UK, as part of the negotiations with the Trump administration – a move Baroness Harman said would be “very heartbreaking”.

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