Britain heads to the polls on June 23rd to decide whether it wants to maintain its membership of the European Union under the terms negotiated by David Cameron earlier this year. Currently, polls are tight, with very few people offering confident predictions about whether Britain will vote to remain.
Britain leaving the EU wouldn’t only impact on the political domain, as it would also have a huge impact on a number of both domestic and international policy areas, such as housing, education and even the finance markets. In this post we take a look at whether Britain leaving the EU could reduce the country’s standing in international forex markets.
Poll of 12,000 Professionals Says “Yes”
In a recent poll of 12,000 market professionals conducted by Reuters, it appears as though the majority of the respondents felt that if the UK left the EU, London would lose its role as the world’s main currency trading hub.
It was felt that Paris, New York, Dublin and Frankfurt would all overtake London as trading hubs in the aftermath of a Brexit, or would at least be the main beneficiaries. Frankfurt is thought to be the main beneficiary.
The 12,000 professionals polled are all members of the ACI Financial Market association, and their conclusions echo those of major banks.
Currently, London is at the heart of the around $5 trillion a day global currency market. As a financial powerhouse, London is able to draw big deals, with the majority of people trading via their desktops in Europe doing so from the London exchange. Due to this, it’s perhaps no surprise that London has seen major investments from market leaders and, resultantly, those market leaders are now wary of the impacts of London leaving the EU.
This is a point that was reflected within the response to other questions in the poll. Of those surveyed, a colossal 80% of the 12,000 respondents said that they believed Britain should stay in the EU, which is around double the national average for the public when asked in surveys conducted either on the phone or in person.
With big banks, market experts and large businesses all apparently wary of Britain leaving the EU, expect to learn more concrete facts about how Britain leaving the EU could affect personal and national finances in the coming weeks and be sure to monitor your investments closely.
***Image thanks to Justgrimes***