Kwasi Kwarteng has been sacked as chancellor three weeks after his mini-budget unleashed chaos in the economy.
He was appointed to the role by Liz Truss only 38 days ago.
Mr Kwarteng’s downfall was set in motion by the mini-budget on 23 September, in which he announced £45bn in unfunded tax cuts.
Accorsing to Sky News, the mini-budget pushed the pound to a record low against the dollar, sent the cost of government borrowing and mortgage rates up and led to an unprecedented intervention by the Bank of England.
Ms Truss and Mr Kwarteng, who have been close friends for years, insisted that the turbulence in the UK economy was part of a global problem exacerbated by the war in Ukraine and post-pandemic recovery.
But last week, after open revolt by Tory MPs and a record surge for Labour in the polls, the prime minister announced the first major reversal of mini-budget policies when she backtracked on scrapping the 45p top rate of income tax.
The second U-turn 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.