UK pound slides as polls indicate support for EU exit

LONDON – The British pound fell sharply Tuesday after two opinion polls for The Guardian newspaper indicated support for a British exit from the 28-country European Union in next month’s referendum.

In both polls, one of which was conducted by phone and the other online, the “leave” campaign was up 52 points to 48.

Both polls were conducted by polling organization ICM. The online poll was unchanged from the previous one in mid-May but the phone poll showed a hefty rise in support for a British exit. Last time, “remain” held a 10-point lead.

The polls jolted the markets, which have recently downplayed the possibility of a vote for so-called Brexit in the June 23 vote. Within minutes of the release of the latest poll results, the pound, which is also known as sterling, was down a cent at $1.4550 while the FTSE 100 index of leading British shares ended the session 0.6 per cent lower.

“Widespread selling for sterling and an immediate flight to safety signifies the fact that markets have been caught napping with an overconfidence that every poll would come out in favour of the ‘remain’ campaign,” said Joshua Mahony, market analyst at IG.

British bookmakers still think a “remain” vote is still the more likely outcome but there’s been a modest narrowing over the past few days. The bookies give a vote to remain a probability of around 75 per cent.

The methodology behind the polls was not immediately available.