The price of the pound sterling registered this Monday its best day since March 2020, at the beginning of the Covid-19 pandemic, after the new UK Finance Minister, Jeremy Hunt, has almost completely dismantled the plan of tax cuts and increased spending announced less than a month ago by the Executive headed by Liz Truss.

In this way, the cross of the pound sterling against the ‘greenback’ reached 1.1439 dollars, its best level since last October 5, with a revaluation of more than 2% in the session, after on September 28 it will sink to 1.0539 dollars.

Likewise, the exchange rate of the British currency appreciated against the euro and reached 1.1656, its best cross since the beginning of last September.

This Monday, in order to avoid speculation, the new UK Finance Minister has announced that, in addition to the decision communicated last Friday by Truss herself to back down on the plan to cancel the rise in corporate tax on 25% from 19%, it was decided this Monday to suspend “indefinitely” the reduction of one percentage point in the basic marginal section of income tax from 20% to 19%, scheduled for April 2023.

Likewise, Hunt has indicated that the Government “will reverse almost all the tax measures announced in the plan communicated at the end of September”, including the cut in the tax on dividends, in addition to not going ahead with the new purchase plan without VAT, nor with the freezing of taxes on alcohol and with the reforms to the rules of work outside the payroll, although it will maintain the reductions in stamp duty and National Insurance.

“All the changes have been designed to provide confidence and stability,” said Hunt.

On the other hand, in reference to the greater measure of spending contemplated in the ‘mini budget’, the head of the United Kingdom Treasury has confirmed that the ceiling of the energy bill will be maintained until April 2023, instead of two years, while that formulas will be studied to alleviate the impact of the rise in fuel prices on homes and businesses.

“We cannot expose public finances to the volatility of gas prices from April 2023,” he defended, warning that “there will be more difficult decisions” in terms of taxes and spending, while reiterating his confidence in UK’s long-term prospects.

On her side, the Prime Minister of the United Kingdom, Liz Truss, has defended the almost total dismantling of the plan for tax cuts and public spending announced by the Government in September, since she considers that “the British population wants stability right now”.

Truss has acknowledged that the country faces “serious challenges” amid “worsening economic conditions.” “We need to act to chart a new path to growth that supports and serves people across the UK,” she said on Twitter.