The pound fell against the dollar on Friday as budget announcements by the new British government, Liz Truss, worried investors about the health of the state’s finances amid growing signs of a recession in Britain, writes AFP.

Against the dollar, buoyed by the resilience of the US economy and its safe-haven status, sterling fell 2% to $1.1042, a level not seen since 1985, and was fast approaching an all-time low.

The British government unveiled on Friday the most radical package of tax cuts in half a century, reducing the tax burden for both workers and companies, Reuters reports.

Finance Minister Kwasi Kwarteng has confirmed Prime Minister Liz Truss’s aim to double the UK’s annual economic growth rate to 2.5% and for the first time has given a figure for the new Prime Minister’s spending plans.

Among the measures announced on Friday is a reduction in the top income tax rate from 45% to 40%.

So from April 2023, 629,000 taxpayers who earn more than £150,000 a year will no longer pay the top rate of 45%, but the 40% tax rate that applies to those who earn more than £50,271 per year.

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