P.M. BRIEFING : No Recession, Exchequer Says

Chancellor of the Exchequer Nigel Lawson denied today that Britain is sliding toward recession and refused to retreat from his unpopular high-interest-rate policy.

In a speech designed to soothe anxious voters and jittery money markets, Lawson told the ruling Conservative Party’s annual conference that there will be no retreat from the battle against inflation.

Calls for the finance minister’s resignation have been growing in the party rank and file and in the normally pro-Conservative press since he raised interest rates 1 percentage point to 15% a week ago.

Lawson declared: “People ask whether there is an alternative to high interest rates at the present time. And whether they can be sure the policy will work. Bluntly, the answer is that there is no alternative and the policy will work.”