The Prime Minister is seeking a UK-US free trade deal with Donald Trump. (Image: PA/GETTY)
Prime Minister Sir Keir Starmer is attempting to strengthen his relationship with Donald Trump in a bid to strengthen the UK's lacklustre economy.
With mounting pressure on the Government after borrowing costs surged Sir Keir is expected to turn to the president-elect for help.
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Speaking to Cabinet ministers on Tuesday, the Prime Minister revealed he wants to strike a “partnership” with the US to “advance our economic growth”.
Sir Keir’s bid to strike a UK-US free trade deal follows a governmental grilling after a surge in borrowing costs raised the question of more tax rises on the horizon.
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Chancellor Rachel Reeves’ economic policy was in the spotlight on Tuesday after she vowed to go “further and faster” in search of growth. While in the House of Commons, Ms Reeves did not rule out public spending or tax changes in March.
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Prime Minister Keir Starmer wants to strike a 'partnership' with the US. (Image: Getty)
However, critics are sceptical of what will come in Spring as many believe an "emergency Budget” will be called, despite previously promising no changes to fiscal policy at that time.
Labour was dealt another blow last week when the yield on the government’s ten-year bonds hit a record of 4.82%, the highest level since the 2008 financial crisis.
With borrowing on the rise, the Chancellor is at risk of maxing out her fiscal headroom. She allocated herself ￡ 10 billion in the budget, which allowed her to stay within the rules. Yet, analysts from Capital Economics predict that Ms Reeves’s budget is already down to her last ￡ 1 billion.
The scrambling government has now turned its attention to restarting trade deal talks with the US ahead of Mr Trump’s inauguration on January 20.
Original plans for a UK-US trade deal emerged following Brexit but failed to materialise under the Conservatives. Despite the president-elect's favouring an agreement during his first term in the White House, negotiations on both sides failed due to disagreements on access to each other’s agricultural sectors.
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Donald Trump will return to the White House next week. (Image: Getty)
While Joe Biden was in office, negotiations ended due to not wanting a new free trade deal. However, Labour are now scoping out the potential of reopening these plans with a narrower target.
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A Downing Street spokesman said of Tuesday’s meeting: “Discussions then turned to the US-UK relationship ahead of next week’s presidential inauguration.
“The Prime Minister spoke of his determination to pursue a partnership with the US for the 21st century, which would protect security, advance our economic growth and leverage the opportunity of new technologies.
“He outlined engagement with the US transition team to date and said the Government’s approach would be based on pragmatism led by the national interest.”