POUND HITS ALL-TIME LOW IN BACKLASH AT KWASI TAX CUTS

LOWEST LEVEL AGAINST DOLLAR SINCE 1971 | Think again before you cut more tax, former minister tells Kwarteng

- Nicholas Cecil, David Bond and Simon English

THE pound nosedived to a record low against the dollar early this morning in a frenzied backlash against Kwasi Kwarteng's tax-cutting bonanza.

Markets took fright after the Chancellor signalled at the weekend that he was ready to slash taxes even more than the £45 billion cuts in his mini-budget.

Sterling crashed to its lowest level against the dollar since decimalisation in 1971, down by more than four per cent to just $1.03 in early trading in Asia before regaining ground to about $1.07 when markets opened in the UK. After Mr Kwarteng's high-octane gamble, piling an extra £72 billion of debt on Britain to fund his tax cuts and energy bills support package, speculation was growing that the Bank of England's Monetary Policy Committee might have to intervene with an emergency interest rate hike to prop up the pound.