Pound firms as May reaches deal with DUP

Investing.com - Sterling firmed Monday as British Prime Minister Theresa May reportedly reached an accord with the Democratic Unionist Party to allow the Tories to govern.The pound was up 0.08% at $1.2729 at 07:30 ET after briefly giving up early gains and dipping to an intraday low of $1.2706.The Democratic Unionists of Northern Ireland will vote with the Conservatives in key legislation, including the Queen's speech, the BBC reported.But there will be no formal coalition with the right-wing DUP, which has 10 seats in the lower house.The Tories lost their overall majority in the snap general election earlier this month, falling nine seats short.Northern Ireland voted in favor of remaining within the European Union in last year's Brexit referendum.The agreement could point to a so-called "softer" approach on the part of the May government in its divorce talks with Brussels.The Press Association quoted DUP leader Arlene Foster as saying she was "delighted" with the "confidence and support" arrangement with the Conservatives.The pound was up 0.21% at €1.1387 against the euro, which was off 0.15% at $1.1178 against the dollar.The dollar index moved back above 97 after early weakness and was trading up 0.14% at 97.12.