The IMF has reacted to the management of the UK economy by the new Governments as incoherent and described fiscal and monetary policy as pulling in opposite operations.

They agree with the Office of Budget Responsibility that spending cuts are needed to balance the books but have not published any figures to back this up, although the OBR puts the number at around sixty billion pounds.

It’s rumoured that Truss has considered ripping up the mini budget due to its unpopularity with backbench Conservative MPs and the effect it has had on the markets.

There is a genuine possibility that if the presentation of the next financial plan goes poorly, Truss will find her position untenable.

It is a long time, if ever, that a Prime Minister has lost control of the Party so quickly. The lack of planning and understanding following the resignation of Boris Johnson, is bordering on breath-taking.

Prime Minister Liz Truss has somehow found Theresa May’s magic money tree as she claims that there will be no cut to public spending to balance the books following the recent announcement of tax cuts. She may simply be so drunk on power that she believes that she has an unlimited mandate.

So far, the latter has been proved untrue as she has been forced to U-turn over the abolishment of the top rates of income tax, faces a rebellion over a rise in the rate of benefits and is accused of a lack of basic economic skills.

Yesterday’s announcement that there will be no reduction in public spending despite the Office for Budget Responsibility’s report of a £60 billion deficit should planned tax cuts go unfunded.

Jacob Rees-Mogg, every Labour MPs favourite pantomime villain, seems to glory in being the archetypical Tory. He was fierce in his criticism of Andrew Bailey, blaming him for the chaos in the financial markets recently.

He appears to have confused the current programme of short-term interest increases with the rises in long-term rates as the Central Bank defended the prospect of gilt fire sales.

Bank of England Governor Andrew Bailey spoke yesterday of the turmoil that the Government's new policies have brought to the gilts market and confirmed that additional support provided by the Central Bank must end this Friday.

The fear that pension funds will begin a fire sale of UK government assets, driving long term interest rates higher, could complete the total breakdown of the market’s confidence in the Treasury.

The Governor went on to say that any intervention in markets is simply to stabilize the situation, and market users cannot become reliant on official support. Therefore, any action taken by the Bank of England will be temporary and must end on Friday.

There is a clear fracture between the fiscal actions of the Treasury and the monetary actions of the Bank of England. The Office for Budget Responsibility in a preliminary report that will be fleshed out on 31st October spoke of its expectation that it will take around sixty billion pounds worth of reduction in Government spending to balance the books.

The Prime Minister appears to have again been forced into a U-turn by Conservative backbenchers. In April, then Prime Minister Boris Johnson pledged to increase certain benefits in line with inflation. Truss was asked about this when she took up the role, and she refused to commit to Johnson’s promise.

The market’s confidence in the UK financial system has been suffering for a considerable amount of time. It began with the Bank of England’s indecisiveness over tightening monetary policy, as Monetary Policy Committee members were unsure of the effect of higher interest rates on economic growth.

Faced with concerns over rising prices coupled with the prospect of lower growth, they tried to manage both, which has proved impossible. Ten months after they first raised rates, the country is still facing a recession and a rate of inflation that is continuing to rise.

Under Rishi Sunak, the Treasury may not have been correct in every decision it made, but he was clear and decisive in his processes, wasn’t afraid of making tough decisions and inspired the confidence of the Cabinet and the Country.

When Sunak hiked National Insurance rates last April, it was an unpopular decision, but he explained that the rise was needed to supply added funding to the National Health Service. The current Chancellor did away with the hike, but apparently remains committed to the NHS.

Kwasi Kwarteng has been Chancellor of the Exchequer for about six weeks now. He came in all guns blazing, making promises he couldn’t possibly keep, and was quickly found out.

The spate of strikes seen recently by postal workers and rail staff and a proposed ballot by nurses are a major threat to the economy, a report published at the weekend warns.

It says that Britain is as close to a general strike than at any time for the past fifty years as Government policies drive militancy to a level not seen since the early seventies.

Workers in more sectors of the economy are seeing offers of pay rises fall short of their expectations.

Liz Truss has been criticized for trying to blind side workers who are seeing real wages decline and those on benefits threaten with the largest decline ever in the real level of what they receive with the reduction of the level of the energy cap.

The cap on energy bills is now set at £2,500 annually for the average household. This is a substantial increase from the average of £1,900 seen prior to October 1st.

Opposition leaders plan to keep up the pressure on new Prime Minister Liz Truss by forcing her to publicly confirm whether she is about to honour a pledge made by her predecessor Boris Johnson, to increase benefit payments in line with inflation or if she intends to save five billion pounds by going for the cheaper alternative of raising them in line with average wages.

There seems to be little alternative for Truss other than to come clean on what she is thinking as until the decision is made public, she will be hounded from all sides. Backbench Conservative Members of Parliament will find it difficult to commit their full support if they still feel that Truss will renege a pledge made only last Spring, while Labour Leader Sir Keir Starmer will keep up the pressure in the House of Commons if he gets even a sniff of a feeling that he has Truss on the run.

Ofgem, the Energy regulator, revealed in a document that was leaked to the press yesterday, that the country faces the possibility of rolling power cuts if it is a particularly harsh winter.

Britain gets ninety per cent of its energy from secure supplies either domestic or from Norway, while the balance is bought on the open market.

In normal times and even in the current climate, that ten percent should be secure, but if Europe runs into supply issues in the peak period of January and February, contingency plans are being looked at to have a series of rolling blackouts lasting three hours at a time in periods of peak daily usage.

Her speech yesterday at the Conservative Party Conference was supposed to be a victory parade. which confirmed the beginning of a new era for the Party and consolidated its position as a safe pair of hands to deal with the economy.

Instead, the Prime Minister Liz Truss was faced with chaos and calamity as she fought to keep her premiership alive.

While there has been no official decision made about how benefits will rise by next Spring, it is understood that Truss strongly favours the lower increase linked to average wages.

If that were to become policy, it is believed that it will be the greatest reduction in real terms to benefits ever.

With the Party close to rebellion and at least two Cabinet Ministers openly breaking ranks, Truss needs to reassert her authority before the situation deteriorates to such an extent that she is left with just two alternatives; comply or resign.

Kwasi Kwarteng, Chancellor of the Exchequer, was forced into a second U-turn yesterday as he brought forward the publication of the Government's financial statement from mid-November to the end of the month.

At the time of the mini-budget, he was questioned why he was not presenting full financial figures to back his arguments regarding growth and taxation,

The Conservative Party’s annual conference has been anything but a victory parade for the new leader.

Former Party Chairman, Grant Schapps, was the first of the old guard to break ranks and criticise the first month of Liz Truss’ policies.

There is another row brewing about benefits: Rumour has it that benefits paid to low income households and the unemployed would only be raised by the level of average earnings and not by the rate of inflation, despite a pledge by Boris Johnson last spring that they would keep pace with inflation.

Kwasi Kwarteng, the Chancellor of the Exchequer, will deliver a mini-budget on September 23rd in which he will not only deliver the Government’s ideas on how it plans to deal with the cost-of-living crisis, but equally importantly, how it will fund them.

This will be something of a baptism of fire for the new Chancellor, who has been rewarded for his unstinting support of new Prime Minister Liz Truss by being promoted into one of the top three jobs in the Cabinet.

It is understood that the dual focus of the Budget will be on energy and tax cuts.

He has also been in the news in the past twenty-four hours as it is rumoured that he is considering removing the cap on bankers’ bonuses which was introduced as part of a post-Brexit shake up in governance of the City of London.

Several banks have relocated to the mainland, and this is designed to lure them back. It won’t be universally popular, since a number of banks are said to be considering cutting overall staff numbers to cut costs.

Unemployment fell again in August to its lowest level since 1975. However, the rate of decline slowed considerably. It is likely that the post-Pandemic boom that was exacerbated by the lack of EU migrants who returned home following Brexit is coming to an end.

The phenomenon of job-hopping, where workers change jobs more regularly to take advantage of higher wages on offer due to shortages in certain sectors is beginning to slow.

This is something that has been seen in the United States and has found its way into the UK jobs market.

The unemployment rate fell to 3.6% in the three months to August, down from 3.8% the previous month.

Average earnings jumped above 5% rising to 5.2% up from 4.7% in July.