Rishi Sunak formally became Britain's Prime Minister after being appointed by King Charles III. The former hedge-fund manager and UK Treasury chief vowed to guide the UK through a period of increasing political and economic instability. He warned of a "profound economic crisis" as the country faces stagflation and has seen three prime ministers in seven weeks.
Sunak's appointment followed a period of market turmoil caused by his predecessor, Liz Truss. Truss's plan to boost growth through unfunded tax cuts and a potential 100 billion pound ($116 billion) subsidy for energy bills rattled financial markets. British 30-year government bonds experienced their sharpest one-day fall since March 2020, and 10-year borrowing costs surged to their highest levels since 2011.
Truss, who became the shortest-serving prime minister in British history, stepped down after being unable to overcome her economic missteps and internal party divisions. The economy she inherited was in crisis, with double-digit inflation and the Bank of England warning of a lengthy recession by the end of the year.
Sunak pledged to repair the damage and regain market confidence, indicating he would keep Jeremy Hunt as chancellor of the Exchequer, who had previously stepped in to reverse Truss's tax-cut plans. Sunak, with an estimated fortune of about 730 million pounds ($827 million), is the first person of color to hold the position and at 42, is also the youngest prime minister in more than 200 years.
