U.K. Markets Make Modest Gains as Prime Minister Boris Johnson Resigns
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LONDON — In the end, it was swifter than anyone had expected.
Having survived a vote of no-confidence last month in Parliament, British Prime Minister Boris Johnson was forced into an about-face, and agreed to step down on Thursday morning following a raft of resignations by disgruntled members of his cabinet.
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Johnson, whose tenure has been scarred by sleaze scandals, allegations of lying and deceit, issues with personal over-spending and a fumbled economic agenda, said he would remain in his post until a successor is named, likely by October.
Markets edged up on news of the resignation with the FTSE 100 climbing 1.23 percent to 7,195.32 in early-afternoon trading. Shares in Burberry were up 0.6 percent to 16.40 pounds, while shares in Unilever were down 0.36 percent to 38.57 pounds.
The pound made modest gains against the euro and the dollar. In early-afternoon trading the pound rose 0.4 percent to 1.18 euros, and to $1.20.
The markets have been watching as multiple government ministers quit their posts this week, accusing Johnson of dishonesty and making promises he cannot keep.
They are not, however, expecting any major fiscal or taxation-related changes under Johnson’s successor. The challenges remain the same no matter who is in office: inflation is stalking the country; gasoline prices are soaring; labor unrest is increasing, and Russia remains a threat to Europe’s security.
Earlier on Thursday, Johnson stood in front of his home, and office, at No. 10 Downing Street and told the country that he resisted resigning for so long out of a sense of duty.
“I felt it was my job, my duty, my obligation to you, to deliver my mandate in person,” he said. “I’m immensely proud of the achievements of this government in getting Brexit done [and] reclaiming the power for this country to make its own laws in Parliament.
“Getting this country through the pandemic, getting the fastest vaccine roll-out in Europe, the fastest exit from lockdown, and in the last few months leading the West in standing up to Putin’s aggression in Ukraine,” he said in listing what he considered his accomplishments.
Johnson added that it was clearly “the will of the Parliamentary Conservative Party that there should be a new leader of that party and so a new prime minister. The process of choosing that new leader should begin now.”
He said he would remain until a new leader is in place.
Many retail and business lobbies declined to comment on Johnson’s resignation. Those that did said the focus going forward needs to be on growth and investment in these challenging times.
Tony Danker, director general of the Confederation of British Industry (CBI), said that Johnson “backed U.K. business throughout COVID, and has been steadfast in his support for Ukraine. He will leave office with our best wishes.
“But we now need the political vacuum to be filled at speed to protect people’s living standards, through action on business confidence, investment and growth. Getting the economy growing again has got to be the number one focus for all politicians,” he said.
Shevaun Haviland, director general of the British Chambers of Commerce said that Johnson’s resignation “will finally bring this chapter of political instability to an end.
“Action is needed quickly to help business. We’re on limited time and the government must reset, rethink and get their house in order and swiftly demonstrate that it is on the side of business if confidence is to be restored. We will continue to work with the government to ensure vital support for business remains a priority,” Haviland said.
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