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Pound down on minister resignation
Published on 21.03.2016 22:13

The British pound has fallen against major currencies over fresh Brexit fears, and the resignation of a key minister which threatens to throw the government into chaos.

Work and pensions secretary Iain Duncan Smith dropped a bombshell over the weekend by resigning from the government siting irreconcilable differences over plans to cut £4 billion from disability benefits.

The secretary noted that the government was protecting the interests of the upper class by choosing to target the less privileged.

The move left Prime Minister David Cameron in shock as he scrambled to seek support for Britain to stay in the Eurozone.

Mr Smith is a known Eurosceptic and his resignation was taken by the market as a challenge to David Cameron’s leadership.

With the in or out sides so close, any news is likely to favor one or the other according to Boris Schlossberg, managing director of FX strategy, at BK Asset Management.

 “The latest poll of polls by National Centre for Social Research shows that Brexit vote is essentially even money with the general public slit at nearly 50% on the issue. Therefore any news flow that could tip the odds either way is likely to create volatility in cable,” Schlossberg said.

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Andrew Masters

Analyst

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