Kwasi Kwarteng’s team today denied he boasted “who cares” if the pound crashed on the night of the 2016 Brexit vote.
The damaging claims resurfaced as the new Chancellor went to ground over market turmoil in the wake of his mini-Budget, with no statement planned yesterday or today.
According to the Evening Standard diary column at the time, he was spotted outside the Groucho private members’ club in Soho saying: “Who cares if sterling crashes? It will come back up again.”
The article’s author Joy Lo Dico tweeted “I overheard him on his phone outside” and he was “exuberant”.
A spokesman for Mr Kwarteng - who was a backbencher sitting on the Finance Committee at the time - today denied the account. They said: “It’s untrue.” They did not give further details.
The pound dropped from roughly $1.50 to around $1.33 on the night of the Brexit vote and then fell further as the year went on.
Yesterday the pound crashed to an all-time low since decimalisation of $1.03, prompting calls for Mr Kwarteng to resign. It later rallied and is on around $1.08.
Last night Mr Kwarteng attempted to calm the markets in the wake of his wave of tax cuts funded by £72bn of borrowing in one year.
He promised a further fiscal statement on November 23 - including independent forecasts of borrowing and growth - and a Budget in Spring.
But the markets could be spooked further after he vowed to continue with “supply-side” reforms to the economy in October and November.
Senior Tory MP Huw Merriman - who backed former chancellor Rishi Sunak for Conservative leader - warned Liz Truss may be losing voters "with policies we warned against", as a new YouGov survey put Labour 17 points ahead, the party's greatest lead since the firm started polling in 2001.
Lenders were withdrawing some of their mortgages on Monday as uncertainty reigned in the wake of Mr Kwarteng's £45 billion package of tax cuts set out on Friday.
YouGov today said just 11% of people think abolishing the 45p tax rate for top earners is a good idea. 72% say it's the wrong priority.
Meanwhile, the Bank of England said it "will not hesitate" to raise interest rates to prop up the value of sterling.
The pound fell by more than 4% to just 1.0327 dollars in early Asia trade, before regaining some ground to about 1.07 dollars on Monday evening.
The Chancellor also said he would bring forward an announcement of a "medium-term fiscal plan" to start bringing down debt levels.
The Treasury said it would now be published on November 23, having previously been slated for the new year, and would include further details on the Government's fiscal rules, including ensuring that debt falls as a share of GDP in the medium term.
At the same time, the Office for Budget Responsibility will publish its updated forecasts for the current calendar amid widespread criticism that there was no update when Mr Kwarteng set out his "plan for growth" last week.
At one point, it was thought that the Bank would be forced to step in with an emergency interest rate hike amid fears the pound could drop to parity with the dollar.
However, governor Andrew Bailey said the monetary policy committee, which sets interest rates, would make a full assessment of the impact on inflation and the fall in sterling at its next scheduled meeting in November and then "act accordingly".
Mr Bailey welcomed the Chancellor's commitment to "sustainable economic growth" as well as the promise to involve the OBR.
"The MPC will not hesitate to change interest rates by as much as needed to return inflation to the 2% target sustainably in the medium term, in line with its remit," he said in a statement.
The move will be seen as an attempt to reassure the markets which were spooked by Mr Kwarteng's unexpectedly large plans for tax cuts funded by a massive expansion in Government borrowing.
Those concerns were only heightened by comments at the weekend by Mr Kwarteng suggesting that there were further tax cuts on the way.
