LIZ TRUSS must reverse her government’s budget to stabilise the economy, the TUC warned today after the Bank of England (BoE) staged an emergency intervention to protect credit flow.

The bank said that it has been forced to buy up long-term government bonds — known as gilts — to prevent borrowing costs from spiralling out of control and stave off a “material risk to UK financial stability.”

It came after the International Monetary Fund urged Chancellor Kwasi Kwarteng to re-evaluate the tax measures he announced in the mini-budget plans last week, and said it was “closely monitoring” developments in Britain, an unusual move.

TUC head of economics Kate Bell said: “The Bank’s intervention should tell the government that this budget must be reversed to protect Britain’s families and businesses.

“We need a new budget focused on stabilising the economy and getting wages rising.

“Not one that puts the UK at risk for the sake of tax cuts for the rich.”

Labour shadow chancellor Rachel Reeves called on Mr Kwarteng to make an urgent statement on “how he is going to fix the crisis he has made.”

She said: “People will be deeply worried about the cost of their mortgage, about their pensions, and about the impact [the BoE’s decision] will have on their cost of living.

“This is a serious situation made in Downing Street and is the direct result of the Conservative government’s reckless actions, which include tax cuts for the richest 1 per cent.

“Their decisions will cause higher inflation and higher interest rates — and are not a credible plan for growth.”

SNP Westminster leader Ian Blackford also called for immediate action, demanding that Mr Kwarteng “comes out of hiding” and for Parliament to be recalled immediately.

He said: “The disastrous Tory budget is taking Britain to the brink of catastrophe.

“The fact the IMF and Bank of England have been forced to intervene shows how much damage the Tories have done and how serious the situation is.”

Institute for Fiscal Studies director Paul Johnson warned that Mr Kwarteng may try to freeze public service spending to get finances back on track.

Divisions within Tories are continuing to widen with MPs voicing concerns over the government’s “mistakes.”

High Peak MP Robert Largan said: “[The] government needs to take a pragmatic, fiscally responsible approach on the short-term support needed for people and long-term strategic thinking to ensure our energy security.”