Published on 24 Jun 2016
On
Friday, the UK took the unprecedented step of voting to leave the
European Union, swiftly followed by the announcement that Prime Minister
David Cameron is to resign in the coming months.
Shortly after the news broke, the pound initially plummeting to a 30-year low, but recuperated some of its losses to sit £1.38 to the dollar by lunch.
Simon Smith, chief economist at foreign exchange broker FX Pro tells Proactive Investors “the reaction of sterling at least is reflected the fact that the world’s not ended, the sun is still shining, the economy is still ticking along and nothing is going to change for at least the next few months”.
He says the pound could be “entering a new paradigm”, or a new era, having trading in a 17.5 figure range, which he adds is “unprecedented”.
