Sterling jumps as Farage reportedly reduces his Brexit Party challenge in UK election

Sterling on Friday afternoon reached a 10-day high against the dollar after reports that Nigel Farage’s Brexit Party will now not contest an additional 43 seats in next month’s U.K. general election.

On Monday, Farage had said his party would not contest any of the 317 seats won by the ruling Conservative Party at the last election. At that point, the Brexit Party leader said his candidates would fight all the other seats held by the main-opposition Labour party and other pro-Remain parties.

However, according to a journalist at the U.K.’s Telegraph newspaper, the Brexit Party will now stand down in 43 seats currently held by other parties.

A majority of the additional seats listed are reportedly in Scotland where the Scottish National Party is expected to do well. The move is seen as offering a chance for the Conservative Party to mop up votes from people who support Brexit.

The British pound jumped above $1.29 on the news, increasing 0.25 percent to reach $1.2910 by 2:30 p.m. London time.

Farage U-turn

The Brexit Party leader had previously threatened to contest almost all the U.K.’s parliamentary seats in a move that could have split the “pro-leave” Brexit vote in the election on December 12 — seen by some as a de-facto vote on the country’s withdrawal from the EU.

Farage had earlier offered to enter into a “leave alliance” with the Conservatives in which certain seats were contested but Downing Street refused to entertain such an offer.

Farage attributed his decision to give the Conservatives a “free run” in certain seats to comments made by U.K. Prime Minister Boris Johnson on Sunday night, where he claimed that there would be no extension of the Brexit transition period which ends in December 2020.

Source: CNBC