Ministers await inflation data as Reeves defends response to market turbulence
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Chancellor Rachel Reeves is awaiting inflation data as the Treasury continues to grapple with rising borrowing costs and market turmoil. The latest indicator of the economy’s health is expected on Wednesday morning, and December’s rate is likely to remain at 2.6%, the same as the previous month.
The Chancellor is dealing with a period of turbulence in the UK financial markets, as the value of the pound has dropped sharply and the cost of Government borrowing has risen to decades-high levels. Her problems have been further compounded by the resignation of one of her ministers at the Treasury, Tulip Siddiq, following an investigation into links to her aunt’s political movement in Bangladesh.
Amid the market turmoil – which puts the Government’s plans for the nation’s finances at risk – Ms Reeves was adamant of the need to swiftly search for economic growth. “We have seen global economic uncertainty play out in the last week. But leadership is not about ducking these challenges, it is about rising to them,” she told the House of Commons.
In a statement to MPs following her China trip, the Chancellor added: “The economic headwinds that we face are a reminder that we should – indeed, we must – go further and faster in our plan to kickstart economic growth.”. Agreements struck in Beijing and Shanghai, where Ms Reeves held discussions on trade and investment, would be worth £600 million to the UK over the next five years, she said.
