Blair's future affects FTSE 100 and Pound

Under pressure to resign: Blair's future remains uncertain

After two days of speculation and calls for the Prime Minister’s resignation, Tony Blair is expected to make a statement Thursday afternoon as regards his position. A week ago the Prime Minister said he would not lay out a time table. But he has been under pressure from a number of back bench MPs to go sooner rather than later. Wednesday’s Sun newspaper ran with a front page lead insisting the PM would leave office in May 2007. However No. 10 has denied this. The media frenzy surrounding the Prime Minister’s future has resulted in many arguably more important stories being buried [BBC]. The so called back stabbing within the Labour party has precipitated resignations [BBC] and created divisions in the party which will no doubt be exploited by the opposition in the months to come. Besides a relatively strong economy, a lowering of unemployment figures and the implementation of minimum wages, the Blair government has been highly criticised over its foreign policy. Alignment with the US in the continued War on Terror, and specifically the war in Iraq, is believed by many to be a serious mistake. The gradual decline in standards within the National Health Service has also been seen as a failure over Labour’s 10 years in power. Labour’s popularity stands as 32% compared to 35% for the Conservative party, this according to a poll shown on CNN. The US broadcaster has given some airtime to the story, but BBC 24 and Sky News are covering little else. Helicopter shots of Tony Blair leaving Downing Street, arriving at a school, leaving a school and continuing commentary from ‘experts’ is filling much of the broadcasting today. And all wait with baited breath for the Prime Minister’s statement. All the uncertainty in the meantime is creating a wavering financial market. There are no changes in interest rates but the Pound has fallen along with the FTSE 100 in the wake of the speculation over the Prime Minister’s future. However, the general view is that any losses will be minimal and the financial impact will be short-lived [Reuters].