Pound hits lowest level in over a year as UK borrowing costs reach 16-year high

The pound has fallen to its lowest level in over a year, while UK borrowing costs hit their highest for 16 years.

Economists have warned that the rising costs could lead to further tax increases or spending cuts as the government tries to meet its self-imposed rule not to borrow to fund day-to-day spending.

In response to an urgent question in the Commons, Treasury minister Darren Jones said there was no need for an emergency intervention, and markets continue to function in an orderly way.

But shadow chancellor Mel Stride said higher debt and lower growth are understandably now causing real concerns among the public, businesses, and in the markets.