July 9, 2018 / 6:53 AM / 2 months ago

Sterling rallies, shrugs off Brexit minister resignation

LONDON, July 9 (Reuters) - Sterling rose in early European trading on Monday, hitting its highest level since June 14, as traders shrugged off the resignation of the UK Brexit minister, believing that a recently announced plan by the prime minister makes a “soft Brexit” likely.

The British currency gained 0.2 percent to $1.3321 after earlier reaching $1.3328 before news of the resignation caused a temporary dip. Against the euro, sterling remained steady at 88.38 pence per euro.

David Davis resigned overnight as Brexit minister because he was not willing to be “a reluctant conscript” to Prime Minister Theresa May’s plans.

Analysts said the market was pleased by May’s plan for Brexit announced on Friday, which they believe makes a “soft” Brexit where Britain retains a close trading relationship with the European Union more likely. (Reporting by Tommy Reggiori Wilkes; editing by Dhara Ranasinghe)

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