The value of British Sterling has hit its lowest value in 31 years as a direct result of Britain’s vote to leave the European Union.
In a move that will have far-reaching effects, not just for Ireland but for international relationships and the global economy, the people of the United Kingdom have opted to leave the EU by a margin of 52% to 48%.
The backlash has been immediate, with the pound weakening by almost 10% overnight – the biggest contraction of wealth in the UK since 1921 and the biggest one-day fall ever witnessed.
A tweet showing a Bloomberg graph highlighting the sharp decline overnight as markets reacted to the UK voting to leave the EU:
The Pound just walked and jumped off a cliff. Congratulations. pic.twitter.com/3QbNGX3xZr
— Tom Cullen (@tom_cullen) June 24, 2016
The GBP hit a low of just 1.33 USD this morning, the lowest level since 1985, and has stabilised at 1.41 USD, dropping from over 1.5 USD yesterday.
The pound also dropped 7 per cent against the euro to €1.2085, with the European currency also falling 3.3 per cent against the dollar.
Wow. The £ is down 8.4%. Currencies are not supposed to do that. (1% move is considered massive.) pic.twitter.com/FI15htQ3WN
— Matt Phillips (@MatthewPhillips) June 24, 2016
The Bank of England issued a statement confirming their commitment to ensuring financial stability as the United Kingdom chose to usher in a period of economic chaos.
Their statement read:
“The Bank of England is monitoring developments closely. It has undertaken extensive contingency planning and is working closely with HM Treasury, other domestic authorities and overseas central banks. The Bank of England will take all necessary steps to meet its responsibilities for monetary and financial stability.”
As feared, Brexit will directly effect other EU countries that use the single currency.
Pound to Euro exchange rate is currently £1 to €1.24, with the Euro down 2% overall in comparison to the British pound’s 9%.
Irish stocks take a beating, dropping by as much as 13%.
Reuters Dublin issued this tweet detailing just how badly affected the individual stocks of Bank of Ireland, Ryanair, Permanent TSB and Smurfit Kappa have been hit as a result of the EU Referendum.
Irish stock market down as much as 13 percent, Bank of Ireland -30 pct, Ryanair -21 pct, permanent tsb -20 pct, Smurfit Kappa – 15pct
— ReutersDublin (@ReutersDublin) June 24, 2016
