Sterling Falls to Fresh 7-Year Low on “Brexit” Concerns

Photo of author

By Jacob Maslow

The pound fell below $1.40 on Wednesday as uncertainty over Britain’s membership in the European Union (EU) remains a concern for many with some UK bosses suggesting that an exit could be harmful to the British economy.

GBP/USD hit lows of 1.3965, the lowest since mid-March 2009. It closed at 1.3985, down 0.24% for the day.

The British currency has now fallen 2.9% this week after a number of senior members of the ruling Conservative party, including London Mayor Boris Johnson, said they were backing the move to leave the EU.

The pound inched lower against the euro, with EUR/GBP rising 0.13% to 0.7870.

Elsewhere, the safe haven yen remained strong as falling oil prices pulled down equity markets, dampening investor appetite for riskier assets.

USD/JPY plummeted to 2-week lows of 111.63 overnight before settling to 112.13 as oil prices remained under pressure after Saudi Arabia effectively ruled out production cuts in the near future, worsening fears of a lingering oil glut.

The euro likewise fell to near 3-year lows against the Japanese currency, with EUR/JPY trading at 123.32.

Against the dollar, the single currency dropped to 3-week lows on Wednesday, with EUR/USD shedding 0.19% to trade at 1.0997.

The U.S. dollar index, which tracks the American currency’s standing against six rival currencies, was up 0.15% at 97.61.

Images Courtesy of DepositPhotos