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Pound tumbles to lows not seen since 1985 | |
(35 minutes later) | |
There has been a dramatic fall in the value of the pound as traders bet on a Leave victory in the UK's referendum on European Union membership. | |
At one stage it hit $1.3459, a 9% plunge, and a low not seen since 1985. | |
Before the results started to come in the pound rose as high as $1.50, as traders bet on a Remain victory. | Before the results started to come in the pound rose as high as $1.50, as traders bet on a Remain victory. |
But following early strong Leave votes in north-east England it tumbled to $1.43 and then took another dive after 03:00 BST as Leave maintained its lead. | But following early strong Leave votes in north-east England it tumbled to $1.43 and then took another dive after 03:00 BST as Leave maintained its lead. |
Currency traders say these moves are more extreme than those seen during the financial crisis of 2008. | Currency traders say these moves are more extreme than those seen during the financial crisis of 2008. |
"Never seen anything like it. These are once-in-a-lifetime moves, bigger than Lehmans and Black Wednesday, and we haven't even had the result yet," said Joe Rundle, head of trading at ETX Capital. | "Never seen anything like it. These are once-in-a-lifetime moves, bigger than Lehmans and Black Wednesday, and we haven't even had the result yet," said Joe Rundle, head of trading at ETX Capital. |
"It's looking more and more like a Leave win and these massive moves in sterling and stocks will only get bigger if that is the case," he added. | "It's looking more and more like a Leave win and these massive moves in sterling and stocks will only get bigger if that is the case," he added. |
EU Referendum Results | EU Referendum Results |
EU Referendum live page | EU Referendum live page |
Around midnight sterling had risen to $1.50 after leading Leave campaigner Nigel Farage said it looked as though Remain had "edged" the vote. | |
But those gains were short lived as the first results showed surprisingly strong votes to leave the EU. | |
As for shares, the markets are pointing to a 8% slump when the FTSE 100 opens on Friday. | As for shares, the markets are pointing to a 8% slump when the FTSE 100 opens on Friday. |
In Tokyo the Nikkei 225 has fallen by more than 6% with the yen up 5% as investors piled into the Japanese currency which is seen as a safe-haven. | |
In commodities, the price of gold jumped nearly 7% to $1,348.27 an ounce. | |
In pictures: UK votes in referendum | In pictures: UK votes in referendum |
Key moments in the referendum campaign | Key moments in the referendum campaign |
EU Referendum: Decision time | EU Referendum: Decision time |
Top four pound moves post World War II | Top four pound moves post World War II |
Source Bank of New York Mellon | Source Bank of New York Mellon |
Shares higher | Shares higher |
Earlier the FTSE 100 closed 1.2% higher to a two-month high of 6,338.1 points, with miners, banks and travel firms rising, as traders had expected a remain vote. | |
Wall Street also jumped in late trading, with the Dow Jones and S&P 500 both closing 1.3% higher. | Wall Street also jumped in late trading, with the Dow Jones and S&P 500 both closing 1.3% higher. |
European markets were also optimistic, with the Dax in Frankfurt and the Cac 40 in Paris rising 1.8% and 2% respectively. | |
Brent crude rose sharply in late trading to end the day 2.1%, or $1.03 higher at $50.91 a barrel, while US crude added 98 cents to $50.11. | Brent crude rose sharply in late trading to end the day 2.1%, or $1.03 higher at $50.91 a barrel, while US crude added 98 cents to $50.11. |
Higher oil prices bolstered shares in Shell, which closed up 3.1% in London, while BP was almost 1% higher. | Higher oil prices bolstered shares in Shell, which closed up 3.1% in London, while BP was almost 1% higher. |