A TOP economist has said that investors have compared the Tory party to a "doomsday cult" amid the chaos which followed the Chancellor's "mini-budget".
Paul Donovan, chief economist of UBS Global Wealth Management, delivered a blistering assessment of the Tory UK Government's fiscal plans as the pound plummeted to a record low on Monday morning.
The SNP warned that this will only "exacerbate" the economic crisis facing the UK and will be felt "deeply" by households as costs are set to continue to rise.
Meanwhile, reports have claimed that Liz Truss-supporting investors made "small fortunes" when the value of the pound collapsed on Friday.
In his morning comment, Donovan wrote: "The global signals from the UK’s mini-budget matter.
"Modern monetary theory has been taken into a corner by the bond markets and beaten up.
"Advanced economy bond yields are not supposed to soar the way UK gilt yields rose. This also reminds investors that modern politics produces parties that are more extreme than either the voter or the investor consensus.
"Investors seem inclined to regard the UK Conservative Party as a doomsday cult."
Donovan also said that the tax cuts brought in by Chancellor Kwasi Kwarteng are unlikely to give the UK a "meaningful medium-term boost".
Instead, the economist expects a short-term "sugar high" is on the cards, but may have its limits.
In contrast to the Tory party and PM's claims that those on higher incomes will buy more and invest in the economy, Donovan said: "A high-income earner’s rational response would be to increase savings in anticipation of future tax increases."
First Minister Nicola Sturgeon branded the Tory economic plans a "catastrophic disaster", adding that the Scottish Government following suit would be "the wrong thing to do".
Kwarteng's plans included the removal of the cap on banker's bonuses, "abolishing" the 45% higher rate of income tax, and scrapping the planned increase to corporation tax.
Treasury estimates put the overall measures as costing nearly £45 billion a year by 2026.
