The UK have made the decision to divorce from the EU, whatever happens next is unknown, but Sterling has taken an 11% tumble as a result.
At the time of writing this morning, the leave camp were in the lead meaning that the UK is set to leave the EU, in what has been labelled the biggest decision for the UK in the last 50 years.
The ‘Remain’ or ‘Leave’ campaigns have been centre stage in the media since the beginning of 2016 and during this time Pound Sterling moved 10.43% from its low to high against the Euro and nearly 7% against US Dollar.
This morning Sterling has fallen to a 31 year low, with Sterling dropping nearly 10% on the shock news. Global Stock markets have crashed on what is being labelled as ‘Black Friday’.
Now that the UK is set to leave the EU, the question is what now for the UK. Sterling has dropped nearly 10 cents on the news that the UK is the first state to leave the EU since it began. Even though investor confidence for the pound has momentarily dipped, the bigger question is what now for the EU? Has the UK leaving the EU started the break-up of the single market? The Telegraph (which has covered nearly every aspect of the referendum) reported that France, Italy and the Netherlands all now want a referendum regarding their EU membership.
There are also reports that the leave vote has secured the path for Scottish independence and a second referendum. And to top it all off – David Cameron’s reputation and job is on the line after failing to keep Britain part of the EU. Many commentators are predicting that David Cameron will stand down almost instantly, which could cause to potentially loose value, as political uncertainty is one of the biggest drivers on the currency market.
This morning the bank of England’s contingency plan are fighting hard to keep the pound afloat. In a statement released last week the BoE has stated that ‘all options are on the table’. David Cameron is set to address the nation this morning and after this Bank of England Governor Mark Carney will address the nation on the future of the pound.
The markets are likely to be extremely volatile today after the shock exit. Europe and the US will be looking at implementing contingency plans. For anyone buying or selling pounds it would be highly worthwhile to speak to one of our team here at currencies.co.uk to discuss your short term and long term options.
The weeks and Months ahead are likely to be shrouded in uncertainty, therefore, if you do have a currency transfer need, we would welcome your requests by calling 01494 725 353 or alternatively, you can email me here.
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