Gilts also fell back following the announcement
There has been a position reaction to the resignation of Liz Truss in the markets.
The Prime Minister stepped down today after just 44 days in office following the fierce backlash against her economic plan and humiliating climbdown.
Low-tax and low-regulation policies unveiled in Kwasi Kwarteng’s budget plunged the markets into turmoil, resulting in IMF intervention and the Bank of England having to step in to keep pension funds solvent.
The Chancellor was forced to resign shortly after and has since been followed by the Home Secretary and now the Prime Minister.
News that the PM was to make a Downing St statement sparked a rally for sterling versus the dollar – leaving the UK currency almost a cent up on the day at one stage at $1.13.
The pound is… rising pic.twitter.com/9TpBxypYZE
— Ed Conway (@EdConwaySky) October 20, 2022
It remained half a cent higher following confirmation she was to leave office.
Shares also moved higher initially on the FTSE 100 and government borrowing costs also fell.
The 30-year gilt yield fell back to 3.8 per cent – continuing its recovery since the post-mini budget highs around 5 per cent that sparked Bank of England intervention.
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