After Liz Truss and Boris Johnson were forced to step down, Rishi Sunak became Britain’s third prime minister in 50 days. In his first speech as PM, Sunak promised to bring the country together in the face of a “deep economic crisis.” He also admitted that his predecessors had “made mistakes.”
The 42-year-old is the first person of colour to lead the UK and the first Hindu to do so.
King Charles II chose him to form his government because he was a former chancellor and had a lot of money. After meeting with King Charles III on Tuesday, Rishi Sunak became the third prime minister of the United Kingdom this year.
According to tradition, the monarch asks the leader of the party with the most MPs to form a government. Since the 2019 general election, that party has been the Conservatives.
After Truss quit on Thursday, the other Conservative lawmakers chose Sunak as the new party leader on Monday.
After the meeting, he gave a speech in front of 10 Downing Street. He said, “Our country is in a deep economic crisis. Putin’s war in Ukraine has upset energy markets and supply chains all over the world. The effects of COVID are still being felt.
He praised his predecessor, Liz Truss, saying that she wasn’t wrong to want to make the U.K. better. growth. But, he went on, “some mistakes were made.” They weren’t made out of bad will or bad intentions, but they were still mistakes, and he had been elected “in part to fix them.”
“I will make sure that economic stability and trust are at the top of the government’s list of priorities. This means that hard choices will have to be made. But you saw me use plans like furlough and do everything I could during COVID to protect people and businesses. There are limits, but I promise that I will bring the same compassion to the problems we face today. “
Sunak then said that in 2019, he would follow the plan that got the Conservatives elected.
After the speech, the British pound was worth $1.1321 per dollar, which was 0.4% more than before. Sterling hasn’t gotten a big boost from Sunak’s new job, but it has climbed back up from its lows earlier in the month, when it fell below $1.10.
Yields on both short-term and long-term U.K. sovereign bonds, also called gilts, went down sharply Monday when it became clear that Sunak would become president. They kept going down Tuesday. Prices move in the opposite direction to yields.
Now, Sunak is expected to start putting new people in his Cabinet, which is part of yet another shakeup at the top of British politics.
Truss resigned after only 44 days in office, 10 of which were spent with government business halted because of the death of Queen Elizabeth II. A number of Conservative MPs wrote letters to her saying they didn’t trust her government after she oversaw a controversial “mini-budget” that shook the financial markets, made it more expensive for the government to borrow money, and raised expectations for interest rates.
Truss had fired her finance minister, changed most of the proposals, and tried to get back to where she was before. But people in her party kept putting pressure on her. This was especially true after a chaotic night in which her interior minister quit and MPs were said to be crying because they were “forced” to vote on fracking, which was seen as a vote of confidence in the government.
Johnson’s departure was also a mess, and it came after months of scandals that made the public and MPs angry. The police fined both Johnson and Sunak for events held at Downing Street during the COVID-19 lockdowns, and Johnson hired a senior political figure even though he had been accused of wrongdoing in the past.
Sunak’s inbox is now full, and there are many predictions that the U.K. is headed for a recession. There are also many factors to consider: the ongoing European energy crisis and war in Ukraine, the weak pound, the planned reworked budget on Oct. 31, which Finance Minister Jeremy Hunt has said will include “difficult decisions” on spending, and the need to reassure financial markets of the U.K.’s economic competence.
