Pound tumbles against dollar and euro as Tory MPs plot to oust Theresa May

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The pound has fallen amid reports Conservative MPs are plotting to oust Prime Minister Theresa May.

Sterling fell to a one-month low against the dollar after MP Grant Shapps was revealed to be leading a group of around 30 Tories seeking a leadership election.

Against the dollar, was down 0.52 per cent to $1.3049 on Friday. Against the euro the pound fell 0.67 per cent to €1.1125, furthering losses made on Thursday after a run of bad economic news for the UK economy.

Mr Shapps, a former party chairman, said both Remainers and Brexiteers were among about 30 Conservative MPs who believed the Prime Minister’s time was up.

“A growing number of my colleagues realise the solution is not to bury our heads in the sand and hope it will get better,” he said.

Connor Campbell, financial analyst at Spreadex, told the Press Association that a battle for control of the Conservative party would be “seriously bruising for the pound”.

He said: “While on Thursday there was a web of reasons why the pound was driven lower, this Friday’s decline seems to have a more singular reason behind it: Tory in-fighting.

“The sound of sharpening knives has only grown louder since Theresa May’s Thick of It-esque speech mid-week.

“Last night there were reports that a group of Conservative ‘rebels’ were seeking advice from those who disposed of Iain Duncan Smith back in 2003, while this morning former Tory chairman Grant Shapps has claimed a number of MPs privately agree that the PM should go.”

The plotters – thought to number about 30 – had intended to go to Ms May “privately” to persuade her to stand down, but Mr Shapps accused Tory whips of leaking his name to a newspaper, as an organiser.

Mr Shapps said the MPs wanting the Prime Minister to resign did not agree on a replacement, which should be a choice for the Tory faithful.

“This is not about promoting an individual. It’s about having a proper and full leadership election and that should go out to party members as well,” he said.

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The rebels hope to gather extra names over the weekend, but are still someway short of the 48 required to trigger a vote of confidence in Ms May’s leadership.

Uncertainty over the leadership of the country has added to bad economic news to drag the pound down this week.

On Thursday, the pound fell 0.4 per cent against the single currency to €1.12, and 0.9 per cent against the dollar to $1.31.

The fall came on the back of weak car sales data and questions from ratings agency, Standard & Poor’s, over the economy’s ability to withstand an interest rate rise.

Car sales slumped 9.3 per cent in September compared with the same month last year, marking their sixth consecutive month of declines and the first year-on-year fall since 2011.

Markets were also weighing implications of the prime minister’s calamitous speech to the Conservative Party conference on Wednesday.