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SINGAPORE — The British pound fell to a 2-year low against the Singapore dollar on Monday (Feb 22) as concern grew that Britain would quit the European Union after influential London Mayor Boris Johnson threw his weight behind the exit campaign. The move posed a direct challenge to Prime Minister David Cameron, who has launched a major push to keep his country within the 28-nation bloc.
The British pound fell through the S$2 psychological support to as low as S$1.9853 on Monday, according to Bloomberg data, a level not seen since November 13, 2013, when it hit a low of S$1.9822.
Sterling also sank to its lowest since May 2010 against the greenback, reversing a gain made on Friday when Prime Minister David Cameron secured a deal on membership terms with EU leaders in Brussels. The next day, Mr Cameron said he would fight to keep Britain in the bloc, and set a June 23 date for the vote.
The pound dropped 1.7 per cent to US$1.4163 as of 9.20 am in London, set for the biggest decline since the day of the UK General Election on May 6, 2010.
Mr Johnson said on Sunday that Mr Cameron had failed to deliver fundamental reform with the agreement and that he would advocate Britain leave the EU. His stance could increase the chances Britons will vote against EU membership in a June referendum.
“The pound is tumbling after the deal clinched by Prime Minister Cameron at the EU summit failed to alleviate fears about Brexit,” said Mr Valentin Marinov, head of Group-of-10 currency strategist at Credit Agricole’s corporate and investment-banking unit in London. “The fact that prominent members of the Conservative Party announced they will campaign for Britain to leave the EU likely underscored investors’ concerns that Brexit risks could increase from here despite the deal.”
Mr Cameron is due to address lawmakers later on Monday. Economists at HSBC Holdings, Britain’s largest bank, said the makeup of the UK could be called into question if the UK votes to leave the EU but Scotland or Wales want to stay. Moody’s Investors Service said a Brexit would be negative for the nation’s credit rating, as the economic costs would outweigh any benefits. AGENCIES
The British pound fell through the S$2 psychological support to as low as S$1.9853 on Monday, according to Bloomberg data, a level not seen since November 13, 2013, when it hit a low of S$1.9822.
Sterling also sank to its lowest since May 2010 against the greenback, reversing a gain made on Friday when Prime Minister David Cameron secured a deal on membership terms with EU leaders in Brussels. The next day, Mr Cameron said he would fight to keep Britain in the bloc, and set a June 23 date for the vote.
The pound dropped 1.7 per cent to US$1.4163 as of 9.20 am in London, set for the biggest decline since the day of the UK General Election on May 6, 2010.
Mr Johnson said on Sunday that Mr Cameron had failed to deliver fundamental reform with the agreement and that he would advocate Britain leave the EU. His stance could increase the chances Britons will vote against EU membership in a June referendum.
“The pound is tumbling after the deal clinched by Prime Minister Cameron at the EU summit failed to alleviate fears about Brexit,” said Mr Valentin Marinov, head of Group-of-10 currency strategist at Credit Agricole’s corporate and investment-banking unit in London. “The fact that prominent members of the Conservative Party announced they will campaign for Britain to leave the EU likely underscored investors’ concerns that Brexit risks could increase from here despite the deal.”
Mr Cameron is due to address lawmakers later on Monday. Economists at HSBC Holdings, Britain’s largest bank, said the makeup of the UK could be called into question if the UK votes to leave the EU but Scotland or Wales want to stay. Moody’s Investors Service said a Brexit would be negative for the nation’s credit rating, as the economic costs would outweigh any benefits. AGENCIES
