Sterling was on the rise in afternoon trading following a a series of optimistic forecasts for the UK economy from Chancellor of the Exchequer Philip Hammond in his first Spring Statement.
Hammond revealed the Office for Budget Responsibility (OBR) had raised GDP growth expectations for 2018 to 1.5%, up from 1.4% it predicted in November, leading to sterling gaining 0.46% against the dollar to $1.396 and 0.18% against the euro to €1.128.
Conversely, the FTSE 100 is down 0.4% to 7,185 points while the FTSE 250 was down 0.6% to 19,996 points.
Hammond, who said he was "positively Tigger-like" as he delivered his speech, as he also rejected the Labour party's "doom and gloom" attitude and remained positive on the UK, which he said faced the future with "unique strengths".
"Forecasts are there to be beaten," the Chancellor said, referencing the OBR's UK GDP forecasts. "Our economy will remain outward looking, confident and ready to compete with the best in the world."
Furthermore, the OBR predicted inflation to fall back below the Bank of England's (BoE) 2% target by the end of the year, leading to real wage growth turning positive in the first quarter of 2019.
Laith Khalaf senior analyst at Hargreaves Lansdown said: "Philip Hammond is feeling particularly Tigger-like apparently, but there's no honey today for public services, more a hint of some honey tomorrow in the Autumn Budget later this year.
"That promise is based on current economic tailwinds continuing until then, and not being snatched away by the vagaries of economic forecasting. In other words, don't count your chickens just yet."
He added: "The pound rose on currency markets in reaction to the improved economic forecasts, in particular the expectation that real wage growth will return to the UK this year, raising the prospects for higher interest rates.
"There's not a great deal of reaction on the stockmarket, reflecting the stripped-down nature of the statement and the lack of any clear policy changes affecting individual companies.
"Despite the upbeat tone from the Chancellor, the UK is clearly out of favour as an investment destination for both domestic and overseas investors. In particular, retail investors continue to withdraw money from funds investing in UK shares, preferring international markets instead.
"While there are clearly risks to the UK economy, the current bout of extreme pessimism towards the UK stock market looks overcooked. The UK is home to a diverse range of companies, many of whom pay a decent dividend, and it shouldn't be ignored by investors looking for a home for their money."
All-day event on 24 April
Consequences could be more severe than in stress tests
AFH has six segregated mandate funds
Variable operating expenses