UK pound is crashing as renewed fears of a Brexit from the European Union surface. Positive economic data is being ignored as Forex traders evaluate what would happen if the United Kingdom left the European Union.
The latest PMI reading from Markit indicates that the UK economy is seeing some improvement. However, the focus isn’t on that improvement right now. Instead, more traders and analysts are concerned about the latest polling numbers regarding a referendum on membership in the European Union.
Earlier polls showed the balance of favor shifting toward remaining in the EU, but the latest poll shows a rather dramatic gain for those who favor leaving the EU.
World markets have responded in dramatic fashion, with the sterling dropping across the board, and crashing through previous floors against its counterparts.
The vote on UK membership in the EU is set for June 23, and the “leave” side appears to be pulling ahead. There have been dire warnings about the economic consequences of a Brexit, and it’s all anyone can think about right now, despite other positive developments.
At 13:46 GMT GBP/USD is down to 1.4415 from the open at 1.4482. EUR/GBP is up to 0.7747 from the open at 0.7686. EUR/JPY is down to 122.46 from the open at 123.27.
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