Theresa May has publicly backed the governor of the Bank of England, Mark Carney, saying he is "absolutely" the best man for the job.
The prime minister's spokesperson told reporters today that May was "clear in her support" for Carney, and supported him staying in his post.
"The PM would certainly be supportive [for him to stay]," she said.
The news led to the pound regaining some of its losses – it was up to $1.2171 against the dollar and €1.1118 against the euro.
Carney is due to meet May in Number 10 early this afternoon.
The spokesperson added:
The PM has always had a good working relationship with the governor of the BoE and intends to continue that.
However, she also also said the choice to stay in the role was a "decision for him", and praised the "work that he has been doing for the country".
Newspaper reports over the weekend suggested Carney was considering leaving the role in 2018, but others have said he is likely to extend his tenure until 2021.
The Bank of England told City A.M that "nothing has changed" and that Carney was due to make his decision public by the end of the year.
But there is speculation that the decision could be announced later this week when the Bank releases its quarterly inflation report.
I am sorry to say this – he seems a nice enough fellow – but Mark Carney should indeed resign. He politicised his office inexcusably.— Daniel Hannan (@DanielJHannan) October 29, 2016
Carney came under attack from pro-Brexit campaigner Daniel Hannan this morning, who said he should quit his role.
"If he does stay, it's got to be on [the] basis that he's not the rock star banker who presumes to tell Scotland whether to stay and Britain which way to vote, but rather sticks narrowly to his brief," Mr Hannan told BBC Radio 4's Today programme this morning.
His supporters want Carney to stay in post to navigate business and the economy through the uncertainty of Brexit negotiations.