Lord Mandelson has been picked as the UK's new ambassador to the United States in a blow to Nigel Farage.

The former business secretary and effective deputy prime minister under Gordon Brown is set to take over from Dame Karen Pierce.

Prime Minister Sir Keir Starmer believes that Mandelson has the trade expertise and networking abilities to bolster the UK’s interests during a delicate period for relations with the US, reports The Times.

His appointment comes ahead of the inauguration of President-elect Donald Trump in January.

Peter Mandelson has been confirmed as the new ambassador

A government source told the BBC: "The fact the Prime Minister has chosen to make a political appointment and sent Lord Mandelson to Washington shows just how importantly we see our relationship with the Trump administration.

"We're sending someone close to the prime minister with unrivalled political and policy experience, particularly on the crucial issue of trade. He's the ideal candidate to represent the UK's economic and security interests in the USA."

Mandelson, an architect of the New Labour revolution, has been picked over three other potential names.

David Miliband, the former foreign secretary, Baroness Amos, a former development secretary, and Baroness Ashton of Upholland, who succeeded Mandelson as European trade commissioner, were all said to be in the running.

Lord Peter Mandelson