Tuesday 23 May 2017

Pound plunges as Brexit vote on knife-edge

Sterling headed for biggest fall on record

A fall in the pound has implications for Ireland because it makes it more expensive for Irish exporters to sell their products in Britain. Photo: Reuters
A fall in the pound has implications for Ireland because it makes it more expensive for Irish exporters to sell their products in Britain. Photo: Reuters

Niall O'Connor and Colm Kelpie

The value of sterling plunged on international money markets as the result of the Brexit referendum proved closer than expected.

The pound was heading towards its biggest fall on modern records as results started to flow.

The result was regarded as too close to call.

A fall in the pound has implications for Ireland because it makes it more expensive for Irish exporters to sell their products in Britain.

And if the final results is for Britain to leave the European Union, analysts expect sterling to fall even further - possibly even close to parity with the euro. This scenario would have enormous consequences for Irish business as it would make goods from this country more expensive for British consumers and Irish businesses less competitive.

The pound had strengthened against the dollar to its highest point since December as polls closed and investors believed the Remain side would win.

But a bigger than expected margin for the Leave side in early declared results spooked traders in Asia and sent the pound into free fall.

Irish Independent

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