The fall in the Pound can be considered as a “poster boy” for the “in” camp. The currency is clearly telling us that business sees leaving the EU as folly. It’s telling us the story better than the words of any politician…. writes Sukhvinder Gill
We now know which corner the heavyweight politicos have decided to occupy. And the markets have reacted.
Sterling has continued to fall, and is now at levels against the USD and EUR not seen since the 2008/2009 financial crisis.
This is the FX market telling us it doesn’t like uncertainty. Not only the uncertainty of the referendum’s outcome, but the years of uncertainty that would ensue if the UK were to leave the EU.
Here’s the interesting thing though; while the Pound is on its heels, the stock market and gilts haven’t reacted in the same vein. This suggests that investors have not decamped from the UK, they’re staying invested – for now anyway.
The fall in the Pound can be considered as a “poster boy” for the “in” camp. The currency is clearly telling us that business sees leaving the EU as folly. It’s telling us the story better than the words of any politician.
This brings me onto the other so called experts in predicting the mood and sentiment of our nation – the pollsters. The opinion polls spectacularly misjudged the outcome of both the General Election and the Scottish Referendum.
Bookmakers, are a form of Market just like the FX and Stock market, were more accurate.
So I am happy to ignore any predictions produced by the professors and PHDs at the Polling companies, and instead take heed of what the Bookies are telling us. According to them the UK is on course to stay in the EU.
( Sukhvinder Gill has worked as a Global Business Head and Trader in Capital markets for over 20 years)