Brexit Fears Stir Devaluation Risks, London’s Downfall
SputnikNews.com
24.02.2016
As the UK is nearing its second major political referendum in less than two years, the Brexit debate has rendered financial market participant nervous, and Canary Wharf is seeing rife volatility, with the pound’s devaluation and capital outflows expected soon.
Kristian Rouz – Heated debate over the UK’s possible exit from the EU in June has badly shaken the performance of the British shares and currency markets, with the pound sterling (GBP) having dropped below $1.40 on Wednesday, compared to its past year’s normal trading gauge of $1.42-$1.60.
The UK’s sterling might extend its losses against the greenback and fall to as low as $1.35 in a week from now, as concerns over financial stability of Canary Wharf in the fragile political environment are fending investors off the City of London.
At the same time, as the Brexit event is estimated to wipeout some 20% off the market value of British financial institutions, the anticipation of the referendum, due in June, is also reflecting negatively on Canary Wharf’s capitalization.
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