UK pound plunges as referendum results point to EU exit

[webfact]

UK pound plunges as referendum results point to EU exit
RAPHAEL SATTER, Associated Press
JILL LAWLESS, Associated Press

LONDON (AP) — The British pound plunged to a 31-year low Friday as results in the country's European Union referendum gave the "leave" side a small but growing lead.

The figures delivered a deep shock to financial markets, overturning earlier anticipation of a narrow victory for "remain."

The pound initially soared as polls closed and two opinion surveys put "remain" ahead and two leading supporters of the "leave" campaign said it appeared the pro-EU side had won. But it then suffered one of its biggest one-day falls in history, plummeting more than 10 percent in six hours, from about $1.50 to below $1.35 as results suggested a strong possibility the U.K. would vote to quit the bloc.

"The dawn is breaking on an independent United Kingdom," U.K. Independence Party leader Nigel Farage said to loud cheers at a "leave" campaign party.

"Let June 23 go down in our history as our independence day!"

As results poured in, a picture emerged of a sharply divided nation: Strong pro-EU votes in the economic and cultural powerhouse of London and semi-autonomous Scotland were countered by sweeping anti-Establishment sentiment for an exit across the rest of England, from southern seaside towns to rust-belt former industrial powerhouses in the north.

"A lot of people's grievances are coming out and we have got to start listening to them," said deputy Labour Party leader John McDonnell.

The "leave" campaign had a lead over "remain" with about 70 percent of voting districts reporting. Turnout was above 70 percent — higher than the 66 percent in last year's general election.

"Few 'remain' strongholds are doing better than expected," said John Curtice, a University of Strathclyde political scientist and BBC election analyst. "There are far more places where 'leave' are doing better than expected."

"It may be possible that the experts are going to have egg on their face later on tonight," he said.

A vote to leave the EU would destabilize the 28-nation trading bloc, created from the ashes of World War II to keep the peace in Europe. A "remain" vote would nonetheless leave Britain divided and the EU scrambling to reform.

The Betfair market predicted an 81 percent chance of Britain leaving the EU, and bookies made Brexit the favorite outcome for the first time.

The first results, from England's working-class northeast, were a smaller-than-expected "remain" win in Newcastle and a bigger-than-expected "leave" vote in nearby Sunderland. The "leave" side also outperformed expectations in other areas of England, though "remain" was ahead in early Scottish results.

There was better news in London, where many areas had strong "remain" majorities.

As polls closed Thursday, pollster Ipsos MORI said a survey conducted on Wednesday and Thursday suggested the "remain" side would win Britain's EU referendum by a margin of 54 percent to 46 percent.

Earlier Thursday, the firm had released a poll that indicated a 52-48 victory for "remain." That phone poll of 1,592 people had a margin of error of plus or minus three percentage points. But the firm's chief executive, Ben Page, said continued polling on Thursday suggested a bigger swing to "remain" that gave the 54-46 result.

As polls closed, Farage set a downbeat tone for the supporters of a British exit — or Brexit — from the EU, telling Sky News television "it looks like 'remain' will edge it" in the referendum, sending the pound to a 2016 peak of $1.50.

But he walked back those comments later, telling reporters at a "leave" party in central London that "maybe just under half, maybe just over half of the country" had voted to pull Britain out of the EU. And by early morning he was declaring the dawn of a new era.

The high turnout had been expected to boost the "remain" vote, because "leave" supporters are thought to be more motivated. But high turnout in working-class areas that typically have lower tallies could also boost the "leave" vote.

"I think it is going to be really close," said photographer Antony Crolla, 49, outside a London polling station.

That was certainly the case in Newcastle, a city which had been expected to deliver a resounding victory for "remain." Instead, the pro-Europe side squeaked by with 50.7 percent of the vote. In Sunderland, 61 percent of voters chose "leave," a bigger-than expected margin.

Polls had for months suggested a close battle, although the past few days have seen some indication of momentum swinging toward the "remain" side. But torrential rains, especially in the "remain" stronghold of London, raised fears of diminished turnout. London's Fire Brigade took 550 weather-related calls as the capital was hit by heavy precipitation, thunderstorms and lightning strikes. Some polling stations were forced to close because of flooding.

Prime Minister David Cameron, who called the referendum and led the "remain" campaign, faces an uncertain future whichever side wins. Almost half the lawmakers from his Conservative Party backed an EU exit, and the "leave" campaign was led by potential leadership rivals, including former London Mayor Boris Johnson.

If "leave" wins, he may have no choice but to resign.

"If the prime minister loses this I don't see how he can survive as prime minister," said Scottish National Party lawmaker Alex Salmond. "Talk about lame ducks. This would be a duck with no legs and no stability whatsoever."

At a referendum night party at the London School of Economics, Kevin Featherstone, the head of the European Institute, said that whichever way things went, the vote should serve as a wakeup call to politicians across the continent.

"One of the deeper headlines from tomorrow, of a narrow victory either way, is that wider Europe has got to learn the lesson about how to re-engage with ordinary publics," he said. "We can see across Europe countries which have been ... far bigger supporters of the European Union for a number of years starting to have serious doubts."

-- (c) Associated Press 2016-06-24

[MJP]

Fantastic!

[webfact]

BREAKING

Pound drops to 31-year low

Pound's value drops to its lowest level since 1985 ahead of result of UK's EU referendum

http://www.bbc.com/news/business-36611512

-- BBC 2016-06-24

[FourAces]

Looks like I need buy a few thousand pounds then

[Calach]

My thoughts with the Scotts who were told they couldn't remain in the UE if they left UK...

Edited June 24, 2016 by Calach

[55Jay]

Blood is running in the streets. Time to buy the Pound.

[CaptHaddock]

My condolences to the Brit expats here on the pound.

[Calach]

Best thing that could have happened to Europe, to UK though...

[JAS21]

My condolences to the Brit expats here on the pound.

Yes ... Premium Cars are 10% more expensive now ...pity that the topic was closed ...

[OMGImInPattaya]

Join the United States in a confederation and trade union of the English speaking nations of the world (USA, Canada, Australia, New Zealand, India, South Africa, and your Caribbean islands). A much better fit than those slippery Continentals ☺

Edited June 24, 2016 by OMGImInPattaya

[daveAustin]

24th June = INDEPENDENCE DAY! Now I know how you yankee doodles feel. What a result!

[daveAustin]

My thoughts with the Scotts who were told they couldn't remain in the UE if they left UK...

Oh gawd. What's the UE? They can vote out of UK if they want, up to them. EU might eventually take them IF they find they can offer them something (it's a rigorous process that involves ALL members)... and if there is still an EU left by that point.

[Calach]

 

My thoughts with the Scotts who were told they couldn't remain in the UE if they left UK...

Oh gawd. What's the UE? They can vote out of UK if they want, up to them. EU might eventually take them IF they find they can offer them something (it's a rigorous process that involves ALL members)... and if there is still an EU left by that point.

 

Let me explain what's the UE : it's a typing mistake.

Edited June 24, 2016 by Calach

[CaptHaddock]

Best thing that could have happened to Europe, to UK though...

Right. Should shave 2% off the UK GDP. Good move suddenly erecting trade barriers with your major trading partners.

[MJP]

Weak Pound is good. Good for foreign direct investment. Good for getting a proper trade balance back. Good for re-balancing the economy back to real production. Good for diminishing our enormous debts.

[sujoop]

This was a referendum 'primarily' based on fear of immigrants if we're being honest.

The 'Farage/Trumpification' pied-piper tactics appealing to the base fears and inner racists of a slight majority of simple Simon's & Sally's wins the day (but at a tremendous cost which is yet to be fully revealed and could well be a catalyst for a global contagion).

Critical separation votes such as this should require a 10% majority margin to pass lest many in the 'win' camp wake up the next day similar to the morning after being rather reckless at a heady party and realise 'oh sh|t, what have I done'....

[Calach]

 

Best thing that could have happened to Europe, to UK though...

Right. Should shave 2% off the UK GDP. Good move suddenly erecting trade barriers with your major trading partners.

 

I assume they will sign treaties to keep the situation just as it is, more or less (just assuming, perhaps not).

[CaptHaddock]

 

Best thing that could have happened to Europe, to UK though...

Right. Should shave 2% off the UK GDP. Good move suddenly erecting trade barriers with your major trading partners.

 

I assume they will sign treaties to keep the situation just as it is, more or less (just assuming, perhaps not).

So you assume. In the meantime you have bet that 2% of GDP on it. Good luck.

There must be at least some small consolation that you get to see the back of Cameron. The Scots will bolt the first chance they get though.

[Inn Between]

Just wondering if any of the Brit expats living here knew that the pound would drop so substantially if Brexit won and converted and good chunk to baht before the referendum, just in case.

[Chicog]

Ignore these indicators, all a symptom of speculation and market uncertainties. Just have a cup of tea, it will all be OK.

[neverdie]

Weak Pound is good. Good for foreign direct investment. Good for getting a proper trade balance back. Good for re-balancing the economy back to real production. Good for diminishing our enormous debts.

How low will it go, how long will it stay there & when will it bounce ?

[Bunnychow]

Just wondering if any of the Brit expats living here knew that the pound would drop so substantially if Brexit won and converted and good chunk to baht before the referendum, just in case.

Yes...i am hoping for a 20 to 25% hit on the GBP when London opens...easy money to be made over the medium term... Edited June 24, 2016 by Bunnychow

[NongKhaiKid]

Ignore these indicators, all a symptom of speculation and market uncertainties. Just have a cup of tea, it will all be OK.

In a matter of hours the Baht value of my State pension fell by 12% and more likely to come. I and others will need something a little more fortifying than a cup of tea i think.

[neverdie]

Ignore these indicators, all a symptom of speculation and market uncertainties. Just have a cup of tea, it will all be OK.

In a couple of days when they realise the sky isn't falling

[Gweiloman]

Just wondering if any of the Brit expats living here knew that the pound would drop so substantially if Brexit won and converted and good chunk to baht before the referendum, just in case.

I'm not a fan of FB but clicking on a link yesterday to a Soros article convinced me that it's better to be safe than sorry. I transferred a chunk of pound sterling out to Hong Kong in the nick of time.

Trying to check rates on XE.com this morning, the site won't load. Looks like they must be getting an unprecedented number of hits.

[alocacoc]

US e-mini and NQ Future trading limit down / halted.

Edited June 24, 2016 by alocacoc

[neverdie]

Ignore these indicators, all a symptom of speculation and market uncertainties. Just have a cup of tea, it will all be OK.

In a matter of hours the Baht value of my State pension fell by 12% and more likely to come. I and others will need something a little more fortifying than a cup of tea i think.

Relax. Breathe.

[MJP]

Weak Pound is good. Good for foreign direct investment. Good for getting a proper trade balance back. Good for re-balancing the economy back to real production. Good for diminishing our enormous debts.

How low will it go, how long will it stay there & when will it bounce ?

I say keep going! (this hurts me personally as you know, but there's the long term future of the Blighty Isle to consider).

Something had to budge. £100Bn a year trade deficit with the EU alone. Debts spiralling. Unsustainable.

[balo]

Switzerland and Norway are doing pretty well outside of EU , I am sure the UK will be able to enjoy their new freedom .

[MJP]

Switzerland and Norway are doing pretty well outside of EU , I am sure the UK will be able to enjoy their new freedom .

France, Holland and Denmark next.