The pound fell further across the board yesterday, as it continued to fight an uphill battle against the impact of a possible Brexit. Whilst uncertainty about the outcome of the vote still lingers the pound is struggling to find support, and continues to move lower. We can expect further volatility as we approach closer to the date.

At the end of 2014 we witnessed huge volatility ahead of the Scottish referendum polls and, to a lesser extent, the same scenario played out in the lead up to the general elections last May. The Brexit vote is set to have a much greater impact on the markets and inspire increased volatility – at present this has purely been downside pressure for the pound.

Yesterday the IMF chief Christine Lagarde warned that global growth remains too slow and that downside risks have increased. Lagarde quoted Brexit concerns and the US election as geopolitical risks. The negative tone helped to undermine risk appetite and added to the pound’s woes.

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Article by Phil McHugh, Trading Floor Manager, Currencies Direct.
* Information courtesy of Currencies Direct
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