Kwasi Kwarteng has been sacked as chancellor three weeks after his mini-budget unleashed chaos on the economy.
He was nominated for the role by Liz Truss just 38 days ago.
Kwarteng’s downfall was set in motion by the September 23 mini-budget, in which he announced £45 billion in unfunded tax cuts.
The mini-budget pushed the pound to an all-time low against the dollar, raised the cost of public borrowing and mortgage rates and prompted unprecedented intervention by the Bank of England.
In the resignation letter of Mr. Kwarteng to Ms Truss, said: “You have asked me to stand aside as chancellor. I have agreed.”
He said he took the job “knowing that the situation we faced was incredibly difficult, with global interest rates and energy prices rising.”
But he said the Prime Minister’s “vision of optimism, growth and change was right” and “continuing with the status quo was simply not an option”.
He ended his letter by saying they are “colleagues and friends for many years” and believes his “view is the right one.”
“It has been an honor to serve as the first chancellor. Your success is the success of this country and I wish you the best,” he wrote.
Moments later, he was seen leaving 11 Downing Street and kicked out of the house he had occupied for just over a month.
Ms Truss and Mr Kwarteng, who have been close friends for years, insisted the turmoil in the UK economy was part of a global problem exacerbated by the war in Ukraine and the post-pandemic recovery.
But last week, after an open revolt by Tory MPs and a record surge for Labor in the polls, the Prime Minister announced the first major reversal of mini-budget policies when she backtracked on scrapping the top rate of the income tax of 45 p.
Image: Kwasi Kwarteng and Liz Truss have been close friends for a long time. Image: Liz Truss/Instagram
The second twist is expected to come on Friday afternoon, with the government set to raise corporation tax from 19% to 25% next April, despite promising not to do so in the mini-budget.
Less than an hour earlier, Kwarteng had landed back in London after cutting short meetings with the International Monetary Fund in Washington DC.
On October 31, he had to make a mid-term tax statement.
The Conservative Party has now had four chancellors in the past three years: Kwarteng, Nadhim Zahawi, Rishi Sunak and Sajid Javid.
And the next chancellor, to be chosen by Ms Truss, will be the seventh Conservative chancellor in 12 years.
While the prime minister will focus on choosing a new chancellor, there is expected to be a renewed focus on whether Ms Truss can stay in the job.
A Tory MP told Sky News: “The idea that the prime minister can just scapegoat his chancellor and move on is delusional.
“That’s his vision. He signed off on every detail and stood by it.”