The Chancellor Rachel Reeves is facing criticism from across the political spectrum for her decision to travel to China as the pound descends into turmoil.
There are increasing demands for action after the cost of borrowing rose to its highest levels in nine months, threatening more difficulty for the UK economy.
The trip to China, accompanied by the Governor of the Bank of England and the Chief Executive of the Financial Conduct Authority, has been planned for months as part of the UK’s attempts to establish relations with Beijing.
But the trip coincided with rising volatility in bond markets. Reeves was absent from an urgent question in Parliament this morning as her deputy Darren Jones refused to confirm whether or not the Chancellor had already left.
The Shadow Chancellor Mel Stride was just one voice from several political parties to call for Reeves to postpone her plans, describing her as “missing in action”.
He said: “The Chancellor should now cancel her travel and focus on this country instead.”
The leader of the Liberal Democrats, Ed Davey, agreed, adding: “Instead of jetting off to China, the Chancellor should urgently come before the House of Commons to cancel her counterproductive jobs tax and set out a real plan for growth.
“The country is paying an ever-higher price for the total mess the Conservative Party made of our economy, and the Chancellor needs to realise that she’ll never dig us out of this hole without a far more ambitious plan to grow our economy, including rebuilding trade with Europe.”
Richard Tice, the deputy leader of Reform UK also added his views, stating: “We are heading towards, be under no illusion, a financial crisis. Will you ask the Chancellor to return from her ridiculous trip to China and reverse course?”
Since Rachel Reeves’s October budget which announced record tax hikes which were primarily aimed at employers, the UK financial market has faltered as bond investors lose faith causing the pound to slump and the cost of borrowing to increase.
On the day Liz Truss demands that the Prime Minister stops accusing her of “crashing the economy,” a CEO of one of the world’s largest independent financial advisory organizations warned of the parallels.
Nigel Green, CEO of deVere Group said: “Bond yields are surging, the pound is in freefall, and Chancellor Rachel Reeves’ stewardship of Britain’s finances appears to be crumbling under scrutiny. Investors must act decisively before they’re caught in the economic crossfire.
“The parallels with the Liz Truss mini-budget debacle of 2022 are obvious, but the risks now are even graver. The toxic combination of a falling pound and rising borrowing costs is historically rare, and it’s a clear signal that the markets have lost faith in this government’s ability to manage the UK’s debt.”
