Nigel Farage at the Brexit Party's General Election campaign launch at the Emmanuel Centre in Westminster, London.

Sterling has risen sharply after Nigel Farage said his Brexit Party will not contest any of the 317 seats won by the ruling Conservative Party at the last election.

Farage said his party will fight all the other seats held by the main-opposition Labour and other pro-Remain parties. The move by the Brexit Party leader gives the Conservatives a big boost in their attempt to increase their majority at the upcoming election.

According to Reuters data, sterling rose 0.6% after Farage's announcement to sit at $1.2859.

In a televised press conference, Farage said that he was making the decision to "prevent the risk of a second Brexit referendum."

U.K. Prime Minister Boris Johnson responded on Twitter, welcoming the decision by Farage and claiming it would help to avoid another hung Parliament in the United Kingdom.

https://twitter.com/BorisJohnson/status/1193873840692224001

The Brexit Party leader had previously threatened to contest almost all the U.K.'s Parliamentary seats in a move that could have split the "pro-leave" vote in the December 12 U.K. general election — seen by some as a de facto vote on Brexit.

Farage had previously offered to enter into a "leave alliance" with the Conservatives in which certain seats were contested but Downing Street had refused to entertain such an offer.

Farage attributed his decision to give the Conservatives a "free run" in certain seats to comments made by U.K. Prime Minister Boris Johnson on Sunday night, where he claimed that there would be no extension of the Brexit transition period which ends in December 2020.

The Chairman of the Brexit Party, Richard Tice, claimed on Twitter that the move put the country before the party.

https://twitter.com/TiceRichard/status/1193868942223302656

In an official response, the Labour Party Chairman, Ian Lavery said the move was a strategic step towards selling off the U.K. National Health Service.

"This is a Nigel Farage and Boris Johnson alliance with Donald Trump to sell out our country and send £500 million per week from our NHS to US drugs companies," he said in a statement before adding, "We urge voters to reject this Thatcherite 1980s tribute act, which would lead to more savage Tory attacks on working class communities. Our NHS is not for sale."