Late last week the “In” campaign looked to be trailing massively, however the tragic killing of MP Jo Cox on Thursday, along with the looming date of the vote, have helped Remain pull back some of its lost advantage.
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Sterling also saw big gains against the dollar, rising 1.71% against the greenback to 1.46 United States dollars on Monday morning, one of its biggest rallies since the financial crisis.
The lack of polls indicating the United Kingdom would leave the European Union just seven days before the crucial referendum was seen as a positive for the Pound and a relief rally ensued.
The advances came after three of six opinion polls showed rebounding support for Britain’s continued membership of the 28-nation trading bloc.
Sterling was up 1.58% to 1.4585 against the dollar and 0.9% to 1.2853 against the euro.
A number of polls including those from YouGov, Survation Opinium all showed that the Remain vote was generally dead even or slightly ahead of the Leave vote – stark contrast from the week prior which saw the Leave vote jump to a 5% advantage. In the long term, however, the calm in the markets would be beneficial, and we would see a return to trading based on performance, rather than fear – which could mean a less volatile index. The Federal Reserve said on June 15 the Brexit referendum was a factor in its decision to keep interest rates on hold.
Currency volatility has retreated to a one-week low after a poll from Survation taken June 17-18 for the Mail on Sunday newspaper showed “Remain” backed by 45 per cent and “Leave” by 42 per cent, reversing positions from Survation’s previous survey.
The Bank of England has also left rates unchanged and said that a vote to leave would severely damage the United Kingdom economy and trigger a sharp sell-off in the Pound.
The FTSE 100 matched global stock markets and rose sharply as bullish investors piled back into equity markets after concerns of a British exit from the European Union eased over the weekend.
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However, it would be wise to take caution this week with the prospects of either result still very possible.
