Business caught by surprise by election announcement

The pound surged to a two-and-a-half month high, while the FTSE 100 slumped to a nine-week low after Prime Minister Theresa May's announcement.

Black Country Chamber of Commerce chief executive Corin Crane described the announcement by Prime Minister Theresa May as a "massive risk" at a time when the country was involved in some of the most important negotiations in its history.

“Given all the announcements we’ve had about the need for stability and a clear focus during Brexit negotiations, this will seem like a huge risk to many businesses who want a clear route through negotiations.

"Beyond this, we will campaign hard to make sure that the Black Country business voice is heard loud and clear by all parties on the key issues such as access to finance, skills gaps and infrastructure investment that our local economy depends on."

One of the first Black Country businessmen to come face to face with the Prime Minister after the announcement was Black Country Local Enterprise Partnership board member Ninder Johal.

The Wednesbury-based managing director of Nachural Records and former Black Country Chamber president was attending a reception at 10 Downing Street for the Uk Sikh community to mark Vaisakhi.

He said:"Only a fortnight ago the Prime Minister was in Birmingham to talk to the LEP about industrial strategy and there was no indication this was on the way.

"She was a lady who was not for turning, but she has turned. I wonder how long this has been in the planning?

"For the next six weeks not much is going to happen in Government. Where does this leave negotations on Brexit?"

Mr Johal said he wondered what impact it would have on the Mayoral election for the West Midlands.

"It could ignite or dampen interest in that election," he added.

Paul Faulkner, chief executive of Greater Birmingham Chambers of Commerce, said: “We understand the importance of having a Government with a strong, clear mandate as we enter the most important negotiation of our generation - Brexit.

“This election, provided it receives the go-ahead from Parliament, should provide that backing to the winner and make clear the will of the British public.

“But we urge the Government to do their utmost to provide stability and consistency in the run-up to the day, and for our new Government afterwards."

The news of a General Election sent sterling up more than 0.6 per cent against the US dollar to trade at 1.264, recovering from a 0.3 per cent drop just hours earlier, and marking its highest level since the start of February.

Versus the euro, the pound jumped 0.5 per cent to 1.186, rising from a 0.4 per cent loss.

Sterling's strength sent the FTSE 100 lower, dropping 1.6% or around 116 points to 7,210 points, its lowest level in over nine weeks.

Carolyn Fairbairn, Confederation of British Industry Director-General, said: “With a snap General Election now called, businesses will be looking to each political party set out their plans to support economic stability and prosperity over the next Parliament in a way that is fair and sustainable for communities across the UK.

“Distraction from the urgent priorities of seeking the best EU deal and improving UK productivity must be kept to a minimum.

“Firms will want to hear commitments from all parties to work in close partnership with business and back a new Industrial Strategy to make the UK economy the most competitive in the world by 2030."