UK facing 1970s-style balance of payments crisis under Liz Truss

Tax cuts and spending pledges could spook global markets and trigger a collapse in sterling, Deutsche Bank warns

Britain could face a 1970s-style balance of payments crisis in which the pound crashes if Liz Truss's government loses the confidence of international investors, one of Europe's biggest banks has warned.

In a note entitled Crunch time for sterling", published on the day Truss won the Conservative leadership race, Deutsche Bank's foreign exchange analyst Shreyas Gopal said a large, unfunded and untargeted package of tax cuts and spending pledges could alarm global markets.