Keir Starmer warns markets are spooked by Tory ‘psychodrama’

The Labor leader also appealed to frustrated Tories deputies put the interests of Art British people first, as he warned that the “psychodrama” in his party was “no game” for people struggling to make ends meet.

Sir Keir told the Sunday Times that Labor would be the “party of sound money”, claiming that there are investors with “huge amounts” of cash who do not trust “Scotland” Conservatives.

The paper said he pointed to evidence that British government bond yields had risen sharply following news that Boris Johnson was returning to the UK to probe another shot at No 10.

Jeremy Hunt could target high earners in his medium-term financial plan in a bid to plug an estimated £40bn black hole in public finances, reports suggest.

The chancellor is said to be considering raising up to £20bn through higher taxation, possibly including a tightening of the capital gains regime.

He could also reintroduce green charges on energy bills, the Sunday Telegraph reports, while savings could come from scrapping a plan to raise defense spending to 3% of GDP.

Sir Keir told the Sunday Times: “The markets are now reacting to even more uncertainty which is a direct result of this Tory government.

“This kamikaze mini-budget will not just be a footnote in the history books. People are paying a price for this: if your mortgage goes up, if you don’t have a fixed mortgage, you will now have to pay hundreds of pounds extra a month.

“It has cost society a lot and I will tell you what will stabilize the markets is a new Labor government with Rachel Reeves as chancellor with absolutely clear fiscal rules.”

He argued that the risk was “the continuation of this chaos” rather than a change of Labor administration.

“I think there is a strong feeling now that we need a general election and that the public cannot be denied access to that while the Tories continue this circus,” he added.

In a message to disgruntled Tory MPs, while veteran backbencher Sir Roger Gale warned that Johnson’s return would lead to a wave of resignations, the Labor leader said: “Country first, party second.

“All those who are going to literally go along with this chaos, instead of allowing us to move to a stable Labor government, are putting party first, not country, and that’s the wrong way to go.

“We all have a responsibility to reduce risk, and that is with the general election.

“There is a lot of interest in this psychodrama, but for people who are struggling to pay their bills, people who have got mortgages that are now higher than they would have been, people who need the NHS, this is not a game.

“And the more this goes on, it hurts working people, it hurts the public.”

Sir Keir also said Labor would “restore respect” to the Office for Budget Responsibility and the Bank of England.

“We need a serious, credible Labor government that will be the party of sound money, and that’s the single most likely thing to settle the market completely,” he said.

“The markets aren’t just some abstract chart that we’re looking at … there are investors with huge amounts of money who don’t trust what this chaotic, messy party is doing.”