Liz Truss resignation sparks recovery for pound, shares and government borrowing costs
There has been a positive market reaction to the resignation of Liz Truss after just 44 days in office, following the fierce backlash against her economic plan and humiliating climbdown.
News that the prime minister was to make a Downing Street statement sparked a rally for sterling versus the dollar – leaving the UK currency almost a cent up on the day at one stage at almost $1.13.
It remained half a cent higher following confirmation she was to leave office.
Truss resignation – live updates
Shares also moved upwards initially on the FTSE 100 while government borrowing costs fell.
The 30-year gilt yield fell back to 3.8% – continuing its recovery since the post mini-budget highs of around 5% that sparked Bank of England intervention. As the afternoon progressed the figure rose to the 3.9% of Thursday morning.
It took a series of U-turns on the tax-cutting growth plan, demanded by new Chancellor Jeremy Hunt after the sacking of Kwasi Kwarteng, for market damage to ease.
The reaction to the departure of Ms Truss signalled a measure of relief that the architect of the Growth Plan – outlined during her campaign for the Tory leadership – was on her way out.
Nevertheless, there was also a measure of uncertainty at play for values, given the complete lack of vision on who would replace the prime minister in Number 10.
It will not be Mr Hunt, who has ruled himself out, leaving him free to continue preparations for the Halloween statement that is to set out the government’s new medium-term fiscal plan.
There will be some jitters over whether its direction is likely to change – or even be delayed to allow the new Tory leader to get their feet under the desk.
There has been no indication that the statement will be delayed as it is expected that the successor will be in place before 31 October.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said of the market moves: “Sterling is highly sensitive to economic policy uncertainty and even though the ship Britannia will still be left largely rudderless, with a successor still to be chosen, as far as investors are concerned, the future is marginally brighter without her in charge.
“Ten-year gilt yields eased further today, as speculation soared about her resignation, a sign of tacit approval from the bond vigilantes who punished the UK by deserting its government’s debt as worries raced up about fiscal responsibility.”
Business appealed for a more stable period ahead.
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Hunt rules out leadership challenge
Tony Danker, the director-general of the CBI, said: “The politics of recent weeks have undermined the confidence of people, businesses, markets and global investors in Britain.
“That must now come to an end if we are to avoid yet more harm to households and firms.
“Stability is key. The next prime minister will need to act to restore confidence from day one.
“They will need to deliver a credible fiscal plan for the medium term as soon as possible, and a plan for the long-term growth of our economy.”
Jess Phillips has said “nothing is off the table” when dealing with the grooming gangs scandal – including a new national inquiry if victims want one.
The safeguarding minister told Sky’s political editor Beth Rigby on the Electoral Dysfunction podcast that she would listen to victims on a new panel that was announced by the government this week.
“Nothing is off the table,” she said.
“And if the victims come forward to me in this victims panel and they say, ‘actually, we think there needs to be a national inquiry into this’, I’ll listen to them.”
Politics latest: Tories told to ‘put up or shut up’
Her comments come days after it emerged she had rejected calls from Oldham Council to hold a government inquiry into grooming gangs in the town, and said the council should commission one instead.
That has led to tech billionaire Elon Musk attacking her and Sir Keir Starmer for not holding a national inquiry and accusing the prime minister of being “complicit” in the abuse.
Professor Alexis Jay finished an eight-year national inquiry into child sexual abuse in 2022 and set out recommendations for the government.
Read more:
What happened in the grooming gangs scandal?
Why the Tories’ attempts to force inquiry won’t work
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Education sec ‘not interested’ in Musk comments
The Conservatives tabled an amendment to the Children’s Safeguarding and Schools Bill on Wednesday to require a statutory inquiry into grooming gangs.
However, Education Secretary Bridget Phillipson told Sky News the Tories “don’t care about children” as the amendment could prevent the entire bill from going forward.
She said: “The measures that I’m setting out today and the legislation in many ways go further because it puts a requirement on all councils to have teams working to keep children safe.
“And the bandwagon jumpers that have come along in recent days, they don’t care about children, they don’t care about making sure that we stop this and we take action.
“They had years to do it and they didn’t do it.”
The Conservatives also rejected a call from Oldham Council for a government inquiry in 2022.
You can listen to Beth’s full interview with Jess Phillips in a special episode of Electoral Dysfunction released on Thursday.
The 14-year-old who was stabbed to death on a bus in southeast London yesterday has been named as Kelyan Bokassa.
He was stabbed to death on a bus in Woolwich Church Street, close to the Woolwich Ferry, just before 2.30pm on Tuesday.
The teenager died at the scene shortly after medical help arrived.
The Metropolitan Police called the stabbing a “horrific attack,” while London mayor Sir Sadiq Khan said the “heart-breaking violence has absolutely no place in our city”.
No arrests have been made so far but officers are appealing for witnesses who were on the 472 bus.
Tributes were left to the teenager, who was a student at St Columba’s Catholic Boys School. Pic: PA
An aspiring rapper, 14-year-old Kelyan was also “briefly” a student at St Columba’s Catholic Boys School in Bexleyheath.
The South East London Catholic Academy Trust said in a statement it was “saddened by the loss of life” and added: “Our thoughts and prayers are with his family and friends at this difficult time.
“Our schools will provide support to any of the students who may be affected by this senseless violence.”
Read more from Sky News:
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Mary Bokassa, the boy’s mother, also told MailOnline that he and others “were taken advantage by gangs” and “were groomed”.
She told the outlet: “He was missing for a year and was living on the street. He finally turned up at my doorstep, he was sick, underweight and tattooed.
“He was exposed to drugs. He probably experienced something because I could sense it. He was not himself. If I questioned him, he wouldn’t tell me anything about his friends.”
Detective Chief Inspector Martin Thorpe, who is leading the investigation, said: “Following Kelyan’s tragic death yesterday, specialist officers are now leading the investigation which is progressing at pace.
“If anyone saw this horrific attack or was in the area then I urge them to come forward and speak to officers.
“We’re particularly interested in any mobile phone footage that captured this incident or any dash cam or doorbell footage from around the surrounding area at the time of this incident.”
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