The Pound Sterling is coming under heavy sell pressure and earlier fell against the US Dollar to a level not seen in more than six years. Though economists and analysts think it an unlikely event, investors remain extremely concerned over the possibility of a Brexit; that is Britain’s withdrawal from the European Union. The Pound is also feeling the pressure from skittish market sentiment which sent investors seeking safe havens. Among first world currencies, the Pound Sterling is viewed as higher risk given the UK’s relatively higher rates and a sizeable current account deficit.
As reported at 10:46 am (GMT) in London, the GBP/USD was trading at $1.39, down 0.80%; the pair hit a session low of $1.3896 while the day’s high was at $1.4026. The EUR/GBP was trading at 0.7905 Pence, a gain of 0.61% for the Euro. The GBP/JPY was down 1.18% to trade at 155.2662 Yen.
Conservatives Increase Calls for Brexit
In only the past few days, the Pound Sterling has lost nearly 3% of its value relative to the US Dollar, and could close out the week as Prime Minister David Cameron’s worst in his six years in office. Analysts point out that the Conservative party members who added their name to the growing list in favor of a pull out haven’t helped assuage market fears.