Rishi Sunak set to be UK’s next prime minister

By Rob Picheta, CNN

Rishi Sunak has given his first speech as Conservative Party leader, telling the party he is “humbled and honored” to win their support.

“I’d like to pay tribute to Liz Truss for her dedicated public service to the country,” he said of the outgoing leader. “She has led with dignity and grace through a time of great change.”

“It is the greatest privilege of my life to be able to serve the party I love, and to be able to give back to the country i owe so much to,” Sunak said.

“The United Kingdom is a great country, but there is no doubt we face a profound economic challenge,” he added. “We need stability and unity, and I will make it my utmost priority to bring our party and our country together.”

“I pledge that I will serve you with integrity and humility … I will work day in, day out to deliver for the British people,” he concluded at the end of a very brief speech.

Instead, Sunak will spend Monday preparing to take over at Downing Street.

That will happen after outgoing Prime Minister Liz Truss visits King Charles III to formally resign.

Charles will accept her resignation, and then welcome Sunak for a meeting and ask him to form a government.

We don’t yet know whether those meetings will take place on Monday or on Tuesday.

Britain’s King Charles III will be heading back to London from the private royal estate of Sandringham Monday afternoon, as had always been his plan, CNN understands. But each side may need an extra day until they’re ready to go ahead with the handover of power.

CNN also understands that there has been no alteration to his schedule in light of this weekend’s events or today’s announcement.

It is not clear whether the King will host audiences at Buckingham Palace on Monday to accept the resignation of outgoing Prime Minister Liz Truss and appoint her successor Rishi Sunak, or whether that will happen later in the week.

Truss, the outgoing and shortest-serving British prime minister, has congratulated Rishi Sunak on winning the race to replace her, less than two months after she defeated him in the year’s first Conservative leadership contest.

In a short and muted statement, Truss said Sunak has her “full support.”

The pound rose against the US dollar as Sunak’s path to power cleared with the withdrawal of rival Boris Johnson earlier Monday, but was last down 0.2% to below $1.128. Yields on benchmark 10-year UK bonds, which move opposite prices, fell to 3.82%.

Sunak campaigned for the job over the summer with promises to help households tackle the rising cost of living, which is causing many to pull back spending. He said he would cut taxes, but only once price pressures eased.

Yet the economic outlook has deteriorated sharply since then — not least because of the market turmoil unleashed by Truss’ now-abandoned plan to slash taxes as soon as possible and boost government borrowing.

A closely watched gauge of economic activity dropped to a 21-month low in October. S&P Global, which tracks the data, said it effectively confirms the United Kingdom is in a recession.

“The heightened political and economic uncertainty has caused business activity to fall at a rate not seen since the global financial crisis in 2009, if pandemic lockdown months are excluded,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.

As Truss’ disastrous tax cut plan proved, any economic stimulus beyond immediate support for energy bills could prove to be a nonstarter for Sunak.

“A key focus for the next Prime Minister and their chosen Chancellor needs to be fiscal responsibility,” Carl Emmerson, deputy director of the Institute for Fiscal Studies, said in a statement. “We need a credible plan to ensure that government debt can be expected to fall over the medium-term.”

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