Pound news – today: Liz Truss says it’s ‘not true’ her mini-Budget is ‘reverse Robin Hood’

Our political correspondent Adam Forrest reports:

Liz Truss is in “complete denial about the damage caused by her reckless and out of touch budget”, said Liberal Democrats’ deputy leader Daisy Cooper.

Lib Dem leader Ed Davey called on the prime minister to cancel the Conservative party conference this weekend, and instead recall parliament to vote to fix the “botched” mini-budget

Liz Truss has insisted she still believes in “sound money” after her chancellor’s £45bn package of tax cuts plunged financial markets into turmoil.

The prime minister told BBC Radio Bristol: “I do believe in sound money. I would point out that interest rates are going up around the world. The Federal Reserve has raised interest rates. This is a global phenomenon.”

Pressed on whether people’s pensions were safe, Ms Truss said: “The Bank of England do that and they do a very good job of it.”

Sterling and the euro fell this morning and the US dollar clawed back a recent dip as relief at the Bank of England’s intervention in bond markets faded.

The British currency leapt the most since mid-June on Wednesday after the bank announced its emergency intervention to shore up the gilt market.

But in the face of nagging doubts about Britain’s economic management and the outlook for global growth, sterling was 1 per cent lower at $1.0775 at 9am – compared to $1.0830 at the previous close – while the euro also weakened 1 per cent to $0.9642, and the dollar regained its footing.

Additional reporting by Reuters

Liz Truss has admitted that there is a “disproportionate effect” to the tax cuts her chancellor has announced, as she failed to directly say there was evidence that cutting the taxes of the wealthiest reduced inequality.

Asked how she was creating a fairer tax system, Ms Truss told BBC Radio Nottingham: “The reality is, people having lower taxes across the board, which is what we’re doing – everything from national insurance to corporation tax to income tax – helps everybody because it helps grow the economy.

“And for too long, the debate in this country has been about distribution, rather than how we grow our economy … It’s not necessarily popular to keep corporation tax low but it’s important we do because I want to make sure we attract investment into this country.”

The prime minister admitted: “We’ve reduced those taxes across the board, and of course people who are better off tend to pay more taxes, so there’s a disproportionate effect there.”

Asked if there was any evidence that cutting the taxes of the most wealthy cut inequality, she said: “There’s plenty of evidence that if you have very high taxes they lead to lower economic growth.”

Liz Truss has insisted that it “simply isn’t true” that she and her chancellor have engineered a “reverse Robin Hood” mini-Budget which benefits the wealthiest disproportionately.

Asked “which bit of it?”, Ms Truss stumbled for a moment before saying: “The entirety of what you’ve just said”, before adding that “the biggest part of the package we have announced is the support on energy bills”.

Liz Truss has been faced with comments from listeners on BBC Radio Kent, who asked questions including: “what on Earth were you thinking?”, “how can we ever trust the Conservatives with our economy again”, and “are you ashamed of what you’ve done?”

Asked “are you [ashamed]?” by presenter Anna Cookson, the prime minister repeated her previous remarks that she had “taken action” to protect people from energy bills of up to £6,000.

But pressed that her support was “cancelled out” by the inflation and fears over mortgages and pensions sparked by her mini-Budget, Ms Truss said: “This will curb inflation by up to 5 per cent … the action we’re taking on energy is expected to curb inflation by up to 5 per cent and we’re also taking action to grow the economy because we were facing an economic slowdown … because of Putin’s appalling war in Ukraine.”

Put to her that “this doesn’t normally happen” for the Bank of England to make an emergency intervention as it did yesterday, Ms Truss continued: “We’re working very closely with the Bank of England.”

But Ms Cookson responded: “They’re putting out your fire, to be fair.”

The prime minister replied: “We have seen difficult markets around the world because of the very difficult international situation we face. And what our government has done is we’ve taken decisive action, first of all on energy bills …”

Told that it is the “other decisive action that people are worried about”, Ms Truss insisted that the government “has done the right thing by taking action urgently to deal with inflation, to deal with the economic slowdown, and to deal with the high energy bills, and of course that involves taking difficult decisions.”

Chancellor Kwasi Kwarteng is working “very, very closely” with the governor of the Bank of England, Liz Truss has said.

“We are facing very difficult economic times. We are facing that on a global level,” the prime minister told BBC Radio Leeds. “Of course lots of measures we have announced won’t happen overnight. We won’t see growth come through overnight.

“What is important is that we are putting this country on a better trajectory for the long term.”

Liz Truss has insisted that her chancellor’s mini-Budget is “the right plan” and has “put this country on a better trajectory for the long-term”, but admitted that higher growth “will not come overnight”.

“As prime minister I have to do what I believe is right for the country and what is going to help move our country forward,” Ms Truss told BBC Radio Norfolk.

“Of course there are many people with many different opinions. But what I think nobody is arguing with is that we had to take action to deal with what is a very, very difficult economic situation.”

Our political editor Andrew Woodcock reports:

Liz Truss initially dodged the question of where she had been for the past four days as markets roiled, pointing instead to her measures to support people with energy bills.

Asked “where have you been?”, Liz Truss told BBC Radio Leeds: “I think we’ve got to remember the situation we were facing this winter … where people could have had to pay energy bills of up to £6,000, where inflation was increasing, and where we were looking at an economic slowdown which would have had a huge impact right across the country, including in places like Leeds.

“So we had to take decisive action, and that’s why we took action to make sure people aren’t paying a typical fuel bill of more than £2,500.”

Pressed again where she has been for the last four days, Ms Truss said: “Well I’m here today on Radio Leeds talking to you”, to which presenter Rima Ahmed shot back: “Brilliant, I’m so glad that you are.”

Liz Truss is speaking with BBC Radio Leeds in the first of several regional radio appearances this morning, breaking nearly a week’s of silence.

Presenter Rima Ahmed began by asking her: “How are you doing, have you slept well?”

To which, the prime minister responded: “I have, thank you very much, and it’s great to be here on Radio Leeds.”