Britain’s new finance minister Jeremy Hunt said he would show investors that he will repair the country’s public finances after the original economic plans of Prime Minister Liz Truss triggered a bond market rout.
“No government can control the markets. No Chancellor should seek to do that,” Hunt told BBC television in an interview broadcast on Sunday.
“There is one thing we can do and that’s what I’m going to do, which is to show the markets, the world, indeed people watching at home, that we can properly account for every penny of our tax and spending plans.”
Investors have sold British government bonds heavily since September 23 when Hunt’s predecessor as finance minister, Kwasi Kwarteng, announced a string of unfunded tax cuts.
Truss – who won the leadership of the Conservative Party barely a month ago after promising to slash taxes – fired Kwarteng on Friday and has ditched key parts of the program they agreed together.
But Hunt has said he will go further including increases in taxes as well as a tighter control on public spending.
Asked whether he thought financial markets would have confidence in his plans, Hunt told the BBC: “Well, I think, you know, for people trading the markets, actions speak louder than words.”
A first test will come on Monday morning when trading in Britain’s battered government bonds resumes without the support of the Bank of England’s emergency bond-buying program which expired on Friday.
