Pound plunges, markets react as Britons decide to leave EU
LONDON— The British pound plunged to a 31-year low Friday as results in the country’s European Union referendum gave the “leave” side a small but growing lead.
The figures delivered a deep shock to financial markets, overturning earlier anticipation of a narrow victory for “remain.”
The pound initially soared as polls closed and two opinion surveys put “remain” ahead and two leading supporters of the “leave” campaign said it appeared the pro-EU side had won. But it then suffered its biggest fall in years, plummeting from about $1.50 (U.S.) to below $1.35 as results showed a stronger-than-expected support for quitting the bloc.
With almost 24 million of an expected 34 million votes counted, the result was closely split, with the “leave” side edging ahead. Just before midnight our time, the BBC forecast a win for the leave side.
“Few ‘remain’ strongholds are doing For the latest updates, go to thestar.com better than expected,” said John Curtice, a University of Strathclyde political scientist and BBC election analyst. “There are far more places where ‘leave’ are doing better than expected.”
Avote to leave the EU would destabilize the 28-nation trading bloc, created from the ashes of the Second World War to keep the peace in Europe. A “remain” vote would nonetheless leave Britain divided and the EU scrambling to reform.
“If the predications now are right, this will be a victory for real people, a victory for ordinary people, a victory for decent people,” said Nigel Farage, the leader of the far-right U.K. Independence Party, in the early hours of Friday as votes were still being counted. “(Let) June the 23rd go down in our history as our independence day.”
The first results, from England’s northeast, were a smaller-than-expected “remain” win in Newcastle and a bigger-than-expected “leave” vote in nearby Sunderland.
The “leave” side also outperformed expectations in other areas of England, though “remain” was ahead in early Scottish results.
There was better news in London, where the first districts to declare had strong “remain” majorities.
The most recent polls had suggested “remain” had a narrow lead.
Pollster Ipsos MORI said a survey conducted on Wednesday and Thursday suggested the “remain” side would win Britain’s EU referendum by a margin of 54 per cent to 46 per cent. Earlier Thursday, the firm had released a poll that indicated a 52-48 victory for “remain.”
That phone poll of 1,592 people had a margin of error of plus or minus three percentage points. But the firm’s chief executive, Ben Page, said continued polling on Thursday suggested a bigger swing to “remain” that gave the 54-46 result.
High turnout had been expected to boost the “remain” vote, because “leave” supporters are thought to be more motivated. But high turnout in working-class areas that typically have lower tallies could also boost the “leave” vote.
“I think it is going to be really close,” said photographer Antony Crolla, 49, outside a London polling station.
That was certainly the case in Newcastle, a city which had been expected to deliver a resounding victory for “remain.” Instead, the pro-Europe side squeaked by with 50.7 per cent of the vote. In Sunderland, 61 per cent of voters chose “leave,” a bigger-than expected margin.
Polls had for months suggested a close battle, although the past few days have seen some indication of momentum swinging toward the “remain” side.
But torrential rains, especially in the “remain” stronghold of London, raised fears of diminished turnout. London’s Fire Brigade took 550 weather-related calls as the capital was hit by heavy precipitation, thunderstorms and lightning strikes. Some polling stations were forced to close because of flooding.
Prime Minister David Cameron, who called the referendum and led the “remain” campaign, faces an uncertain future whichever side wins. Almost half the lawmakers from his Conservative Party backed an EU exit, and the “leave” campaign was led by potential leadership rivals, including former London mayor Boris Johnson.
If “leave” wins, he may have no choice but to resign. “If the prime minister loses this I don’t see how he can survive as prime minister,” said Scottish National Party lawmaker Alex Salmond.