There’s only one week to go until the British general public decide whether they want their country to remain in the European Union or not in the EU Referendum. This week has seen a huge surge for the Brexit campaign, with betting companies shortening the odds on a “leave” vote. However, the polls are still nail-bitingly close. Have you kept up with the headlines this week?
- – The impact of a Brexit on a range of financial markets within the first six months after a theoretical Leave vote would be devastating, Morgan Stanley has announced. They predict that a Leave vote would make equities fall by 15%.
- – The Sun newspaper, the most-read newspaper in Britain, has come out in support of a Brexit vote, saying they urge their readers to “beLEAVE” in Britain and vote to quit the EU.
- – Leave campaigners have set out a plan for the UK to “take back control” if it votes to leave the EU. Parliament should act to end free movement and curb the power of EU courts, Vote Leave said.
- – George Osborne has warned of emergency spending cuts and tax rises if the UK votes to leave the EU. However, 57 Conservative MPs say they would block the plans.
- – British businesses that have come out in support of “Remain” now include Rolls-Royce and BT. Rolls-Royce commented that a Brexit would “limit any company’s ability to plan and budget for the future.”
- – Bookmaker William Hill says that a Leave vote in the June 23 referendum will take over from Remain as the favourite by the weekend, if not earlier. This is so that the bookmakers’ odds will align with recent voter polls.
- – The FTSE 100 fell through the 6,000 level on Tuesday, as Brexit fears shook financial markets around the world. Investors offloaded risky equities in favour of safe-haven assets such as gold after the latest referendum polls showed the Leave camp leading. In just four days, more than £98 billion has been wiped off the value of Britain’s biggest companies on the FTSE 100 index.
- – New research from the German Institute for Economic Research has reported that a Brexit would have a materially negative effect on the German economy. It would potentially reduce German GDP growth by as much as half a percentage point in 2017.
- – The US Federal Reserve has kept interest rates at between 0.25% and 0.5% in the face of an uncertain jobs market. The possibility of Brexit was one of the factors that led the Federal Reserve to keep interest rates on hold, Chair Janet Yellen said.
- – If the UK votes to leave the EU next week, the move could ultimately lead to the bloc’s disintegration, Germany’s foreign minister has declared. Mr. Steinmeier warned against a “nationalism that pits one European state against another.”
- – Gold could climb to $1,400 a troy ounce if British residents vote to exit the European Union, analysts at Capital Economics said. Investors are keen to put their funds into a safe-haven asset, especially with both the idea of a Brexit, and a non-establishment US Presidential nominee.
What do you think of the Brexit news this week? Which side do you think is appearing more credible, and how will you be interpreting this information on the stock markets?
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