Pound on steadier ground as it peels itself off 31-year lows
The pound showed some much-needed signs of life this morning as the currency picked itself off the floor and gained ground against the dollar.
By mid-morning sterling was up one per cent on the day, trading at the dizzying heights of $1.3355. Were it not for yesterday's dismal performance that would still have been a 31-year low but, after falling below $1.32 yesterday, investors called an end to the pound's terminal decline.
Analysts suspected it still had further to fall, but, for now, markets are taking a breather after the most volatile days in trading since the financial crisis.
The euro also recovered some of its own lost ground, leaving sterling up just 0.2 per cent against the single currency.
Stock markets performed even better, soaring 2.4 per cent in the first half of the session to 6,124. Banking stocks staged a tentative recovery, with Barclays and RBS climbing by around four per cent – still one-third down since the result of the vote was announced.
Analysts, however, were not optimistic.
"A bounce was overdue, of course, and it doesn’t change the short-term narrative of uncertainty and fear, nor the longer-term bear market in equities that has been ticking along for over a year now," said Chris Beauchamp at IG.