Sterling slips again after latest opinion polls show strong support for Brexit

Sterling has lost 0.9 per cent against the US dollar in overnight trading, falling to a three-week low of $1.4387, after another opinion poll showed the Leave side ahead, reports CityAM.

A survey for ITV by YouGov, out at midnight last night, put support for leaving the EU at 45 per cent, while Remain came in at 41 per cent. That was a reversal from the same survey last month, which had Brexit backers on just 40 per cent, with Remain ahead on 42 per cent.

Digging into the detail, surveys over the last few weeks have not made easy reading for Remainers, who may have thought they were home-and-dry after taking double-digit leads following the string of Brexit recession warnings from Mark Carney, Christine Lagarde and George Osborne.

More than two-fifths of voters told YouGov they would still vote to leave the EU even if they knew it would make them £100 a year worse off. That was up from just over one-third back in April, and could be a sign that the In camp’s relentless focus on the economy is misfiring – or that Vote Leave’s big push on immigration last week has paid dividends in terms of shifting the debate.

Over the weekend, bookies once again cut the odds of the UK voting to leave to around 9/4 – well off the 4/1 reached two weeks ago.

Volatility in the pound also hit a new seven-year high overnight, reaching 21.6 per cent according to Bloomberg, up from levels of around ten percent earlier this year. The spike represents the fact that one-month options and futures contracts now go past the date of the vote and so are incorporating the possibility of sharp currency movements over the next 30 days.

The fall against the dollar is even more stark given Friday’s disappointing jobs figures which effectively killed off the prospect of the US Federal Reserve hiking interest rates in June. That should, in theory, have weakened the dollar against other currencies.

Sterling was also down by 0.75 per cent against the euro at €1.2678. At the end of May the pound was trading above €1.31.

City economists and currency traders polled by City A.M. think the pound will fall to around $1.40 by the time of the referendum.