Pound nosedives after Dominic Raab quits as Brexit Secretary 

Pound nosedives after Dominic Raab quits as Brexit Secretary

  • Pound had steadied after Brexit deal was agreed by Cabinet yesterday
  • But Brexit Secretary’s bombshell departure sent Sterling tumbling today
  • Experts say markets are responding to fears of no-confidence vote in PM 

The pound tumbled today after Brexit Secretary Dominic Raab’s resignation sparked fears the UK could leave the EU without a deal.

Sterling fell heavily against most major currencies, dropping 1.1% to 1.28 US dollars and was 1.2% lower against the euro at 1.13.

Mr Raab sensationally quit the cabinet this morning, saying he cannot support Theresa May’s plan for Brexit.

His resignation was followed by that of Work and Pensions Secretary Esther McVey, who said Mrs May’s Brexit deal ‘does not honour the result of the referendum’.

The pound fell sharply against the US dollar this morning after Dominic Raab’s resignation

Nomura analyst Jordan Rochester said: ‘Raab resigning just now changes the ballgame. [It’s] hard to be optimistic on the pound in the short term. 

‘But equally Theresa May has survived much worse. It’s whether we get a flood of (ministerial) resignations to follow.’

Valentin Marinov, head of Group-of-10 currency strategy at Credit Agricole SA told Bloomberg: ‘The resignation of Brexit secretary Raab comes at a difficult time for May and could raise the risk of a vote of no-confidence in the PM.

‘The pound is lower on that but it seems that uncertainty could push it lower still.’

Hours before Mr Raab’s and Ms McVey’s resignations, Shailesh Vara had quit as minister of state for Northern Ireland, saying Mrs May’s agreement ‘leaves the UK in a halfway house’.

The departures leave it even less likely that Mrs May will be able to get her agreement with the EU through Parliament and could see her party move to oust her as leader.

The pound had ended higher on Wednesday after the Prime Minister said she had won over her divided cabinet following a five-hour meeting.

But this morning’s resignation sent jitters through money markets.

The currency nosedived after Dominic Raab quit as Brexit Secretary

His resignation was followed by that of Work and Pensions Secretary Esther McVey

The currency nosedived after Dominic Raab quit as Brexit Secretary. His resignation was followed by that of Work and Pensions Secretary Esther McVey (right)

 

Read more at DailyMail.co.uk