Pound excelling from EU referendum polls
26 May, 2016
The pound carried on its powerful surge yesterday and continued making significant gains across the board. Sterling managed to gain over a cent on the Euro throughout the day, EU referendum polls are being released from various news outlets and with them being in favour with the UK to stay in the EU sentiment is staying with the Pound. Since the EU referendum was announced the pound was hit hard as the highs we saw last year quickly diminished and Sterling drop into the early 1.20’s as the Brexit campaign looked to be taken very seriously and early polls suggested that the public were divided in half on which way the vote would go but as of late that seems to have changed and current sentiment is with the stay campaign.
This has brought some confidence in the UK and as such has seen the pound claw its way back and as a result we are currently seeing a 3 month high for Sterling against the Euro and a month high on the Dollar. With the stay campaign in full swing and revelling in the current poll releases this does not mean to say that the result is done and dusted. The Brexit is still a real possibility and one positive poll for Brexit could reverse these gains we are seeing and send the Pound back down, after all the view of the UK of staying in the EU is only speculative not certain by any stretch and with sentiment being heavy on the stay campaign could see most of the gains for Sterling already priced in and come the result could only see minimal further gains if any at all.
Just be vigilant if you do have a big requirement coming up now and within the time frame of the referendum as if the UK was to leave the EU the consequence would be more impactful to the Pound than it would be if we were to stay and you could stand to lose more than you would gain. Although the Referendum is having a big impact on the market there is still important data being released from various places today, starting in the UK at 9.30am GDP figures are to be announced Which is expected to remain the same but any other result could cause the Pound to react. Later on in the afternoon at 1.30pm the US release Durable goods orders, consensus is that the figure is to be negative which could see the Euro claw back some lost ground should that be correct. Later the states also release Markit PMI and Pending home sales at 13.45 and 14.00 respectively.
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