In an echo of history, the British Pound has lost its dominance | World News, The Indian Express

>the value of the pound sank to its lowest recorded level: 1 pound = $1.03 after falling more than 20% this year.

>The immediate cause of the pound’s alarming fall Monday was the announcement of a spending and tax plan by Britain’s new conservative government, which promised steep tax cuts that primarily benefited the wealthiest individuals along with expensive measures to help blunt the painful rise in energy prices on consumers and businesses.

>The sense of crisis ramped up Wednesday when the Bank of England intervened, in a rare move, and warned of “material risk to UK financial stability” from the government’s plan. The central bank said it would start buying British government bonds “on whatever scale is necessary” to stem a sell-off in UK debt.

>The Bank of England’s emergency action seemed at odds with its efforts that began months ago to try to slow the nearly 10% annual inflation rate, which has lifted the price of essentials like petrol and food to painful levels.

tl;dr

1. Kwasi Kwarteng's mini-budget speech threatened the bond market and a possible run on pensions.

2. the Bank of England swooped in by announcing emergency QE for the next 2 weeks by buying bonds.

3. since inflation is already 10% in Bongland, this move has crumpled the pound sterling.

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