UK Treasury chief tries to calm markets amid ‘Brexit’ fears

Cameron, who is staying on for three months as a caretaker, refused to notify the European Union formally of Britain’s intention to quit, leaving the job to whoever replaces him as Conservative leader and prime minister.

Boris Johnson declared that the Chancellor’s calming statement showed that “project fear is over”.

We have worked systematically through a plan that today means Britain has the strongest major advanced economy in the world.

The pound was trading at $1.3365, down nearly 3 per cent from Friday’s close.

RBS, which is 73% owned by the taxpayer, and Barclays saw their shares suspended for five minutes as automatic circuit breakers sprung into action when they dropped by more than 8%.

The FTSE 100 was down one per cent mid-morning amid rollercoaster rises and falls, with top shares worth around £15 billion less than at the opening.

“I regret there have been resignations today from my shadow cabinet”.

Corbyn said he will not resign, and has appointed lawmakers loyal to him to fill the vacated posts.

A petition demanding a second European Union referendum hit 3.6 million signatures, including 700,000 Londoners.

German Chancellor Angela Merkel has taken a softer line.

Osborne also said the volatility seen in financial markets is likely to continue.

“It is clear that markets are volatile, there are some companies considering their investments and we know this is going to be far from plain sailing”.

“I do not believe you have the capacity to shape the answers our country is demanding and I believe that if we are to form the next government, a change of leadership is essential”, she wrote. “And we are determined that, unlike eight years ago, our financial system will help our country deal with any shocks and dampen them, not contribute to those shocks or make them worse”. Osborne said a new budget would be the responsibility of the new government now that Prime Minister David Cameron has said he will resign by October.

In his first public appearance following the referendum results on membership of the European Union, Osborne said Westminster had put in place contingency plans and there was room for both the government and the Bank of England to act. However, he said he would outline his role within the Conservative party in the days to come. Senior allies said he still has strong support among the party’s rank-and-file members, who chose him as leader previous year.

“I intend to play an active part in that debate”, he said.

Osborne said he wanted to reassure the country, and the global community, that Britain would face Brexit from a position of strength due to action taken since 2010 to reduce the deficit and boost the economy. “I am completely focused on bringing stability and reassurance”.

However, there was confusion among the Brexit-backers about what a future relationship with Europe would look like.

In his regular column for the Daily Telegraph, Johnson sought to strike a conciliatory tone.

However, single market rules stipulate that countries must accept the free movement of people as well as goods.

He added: “The capita fee for Norway is exactly the same as Britain is paying into the EU- so there won’t be any savings”.

“We expect a recession”, is one of the straightforward statements in the note, which explains that the forthcoming period of heightened uncertainty will crush economic momentum in the United Kingdom, with a 2.5% drag on GDP growth over the next 12 months and a “mild recession lasting three quarters”.