The prime minister has sacked her chancellor, Kwasi Kwarteng, after being forced to scrap the central plank of last month’s mini-Budget.
It is not yet known who has been promoted to Number 11, after Liz Truss was forced to sacrifice her political ally and perform another humiliating U-turn.
Truss will address an emergency press conference this afternoon, which will not be attended by Kwarteng.
Yields on gilts narrowed earlier today as markets responded positively to speculation that the chancellor would be forced to resign or be sacked.
In his letter to the prime minister, Kwarteng said: “You have asked me to stand aside as your chancellor. I have accepted.”
However his letter made it clear that the fiscal policy at the heart of the maelstrom was as much the PM’s vision as his: “Your vision of optimism, growth and change was right.
“The medium-term fiscal plan is crucial to this end… I believe your vision is the right one. It has been an honour to serve as your first chancellor.
“Your success is this country’s success and I wish you well.”
— Kwasi Kwarteng (@KwasiKwarteng) October 14, 2022
In her response the prime minister wrote: “We share the same vision for our country and the same firm conviction to go for growth.”
Former foreign secretary Jeremy Hunt has been named as Kwarteng’s successor as chancellor.
Melanie Leech, chief executive of the British Property Federation, told EG: “Clearly, the events of the past couple of weeks had made the chancellor’s position extremely difficult. Real damage is being done to the economy and markets, and we now urgently need clear policies. In Jeremy Hunt we have somebody who has resolved various crises, and hopefully he can stabilise the situation.”
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