Pound drops after polls show Brexit support growing

Sterling dropped to a three-week low versus the dollar

yesterday after polls showed that Britons favoured quitting the European Union.

That revived concerns that the June 23rd referendum may throw global markets into turmoil and undermine confidence in the EU.

Meanwhile, 93 per cent of Irish chief executives believe a British exit from the EU is the top threat for businesses here, according to a survey by PwC.

The Irish arm of the global accounting and consulting group also nailed its colours to the mast by stating its preference for the United Kingdom to remain in the EU, echoing a call made recently by PwC in the UK.

Sterling touched a three-week low on a trade-weighted basis yesterday on concern that support for Britain leaving the EU is growing.

Leaving

Bookmakers shortened their odds, with betting website Betfair putting the chances of a vote to leave at 31 per cent. Odds at the end of last week implied a 27 per cent chance of Britain leaving.

Sterling was down 0.3 per cent on the day at $1.4465, having fallen as far as $1.4352, its lowest for three weeks, in early Asian trading. The euro gained 0.3 per cent against sterling to 78.55 pence.

Some 87 per cent of Irish chief executives said Brexit would have a negative impact on Ireland’s economy, while 3 per cent see it as a positive, according to preliminary results from PwC’s 2016 Irish CEO Pulse Survey.

Political interests

Feargal O’Rourke, PwC’s managing partner here, said his firm believed it would be in Ireland’s strategic, economic and political interests for the UK to stay in the EU.

“Brexit, whatever form it may take, will have a significant impact on Irish businesses that are currently trading with the UK, and could have a negative effect on future trade and investment decisions and job creation here.

“We believe that our economic future is best secured through continued shared membership of the EU.

"We hope that our view will be considered by the 120,000 UK citizens living in Ireland who are entitled to vote in the referendum, and by the 828,000 residents of the UK who identified themselves as 'Irish only' in the 2011 UK census," said Mr O'Rourke. – (Additional reporting by Bloomberg and Reuters)