EU referendum: Sterling and FTSE fall as Brexit fears weigh

 
James Nickerson
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Pound Sinks To All Time Low Against The Euro
Expectations are that Brexit would lead to a fall in the value of sterling (Source: Getty)

Brexit jitters have hit markets and sterling this morning with just 10 days until the UK goes to the polls.

The FTSE 100 shed over one per cent as it opened before settling slightly near 0.5 per cent down.

"Sliding bond yields, growth concerns and more opinion polls showing the Leave camp solidifying their lead in the polls ahead of next week's Brexit vote saw both European and US markets fall sharply at the end of last week, and these concerns look set to translate into a weaker open at the beginning of this week," said Michael Hewson, chief market analyst at CMC Markets.

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Sterling fell to €1.254, a six-week low against the euro, and 0.5 per cent against the dollar to $1.4137, a two month low.

That's not just because of the EU referendum, though. IG's Joshua Mahony said: "Even if we manage to navigate the near term threats of a Brexit and a likely US rate hike, the continued slowdown in China remains a significant ongoing risk to global demand.

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"It is clear that in a week which is relatively light on economic data, the focus will remain on the risk of a Brexit, which could destabilise not only the future of England, but also the European project as a whole."

According to bookmaker Betfair, the probability of Brexit rose to 34 per cent this morning, while traders see Leave's momentum growing.

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