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June 2016

Sterling slumps as referendum polls backs Brexit

Published: Monday 06 June 2016

Today has been all about the Polls, at least as far as Sterling is concerned.  Both YouGov and ICM’s latest polling has shown the Leave camp moving ahead of those wishing to remain. As a consequence, the cost of insuring against Sterling volatility has hit a Seven year high. The highest level since the collapse of the Lehman Brothers in 2008.  One-month implied Sterling volatility, or the price of insuring against swings in the Pound against the Dollar, has jumped to 21.9, the highest since February 2009. It hasn’t topped 15 in six years.
 
This afternoon we have Fed chair Yellen speech at 17:30 GMT and RBA cash rate overnight. The Fed chairwoman will likely use her speech in Philadelphia to dampen speculation and seek ways to stimulate the economy rather than pave a way for an interest hike. 
 
Latest FX news by Chris Verdet