Share

Pound hits two-year high on Scotland results

Tokyo - The British pound surged to a more than two-year high against the euro on Friday, while it also rallied against the dollar as Scotland appeared likely to vote against independence from the United Kingdom.

The euro tumbled to £0.7809 in Tokyo trade, from 0.7882 pounds and its lowest level since July 2012, as dealers welcomed initial returns pointing to a disappointing night for the "Yes" camp. Some news organisations have also called a "No" win.

Sterling also jumped to $1.6522, its highest level since early September and much stronger than the $1.6389 in New York. It is also well up from the $1.6227 in Asia earlier on Thursday.

The pound hit a six-year high of ¥180.16, up from ¥178.78 on Thursday.

"Although a large number of constituencies have still to declare, the results currently indicate that this will probably prove a vote in favour of remaining in the Union," Simon Derrick, chief markets strategist at BNY Mellon in London, said.

And Sacha Tihanyi, senior currency strategist at Scotiabank in Hong Kong said the pound could rise as high as $1.66 during the day.

The British unit had suffered a sell-off in the past week after an opinion poll showed a majority of people in favour of leaving the 307-year-old union, which could have hammered the economy.

In July, sterling hit its highest level against the dollar since 2008 during the financial crisis, but then plummeted to a 10-month low as polls showed strong gains for the "Yes" campaign.

A vote to stay in the United Kingdom "would remove uncertainty over some very big issues", said Alan Ruskin, global head of G10 foreign-exchange strategy at Deutsche Bank.

The pound "can now revert back to the traditional fundamentals which had been driving it, such as the relative strength of the UK economy and expectations of tightening by the Bank of England", he told Dow Jones Newswires.

In other trading, the dollar soared to six-year highs at ¥109.26, against ¥108.68 in New York, while the euro slipped to $1.2917 from $1.2921.

The European single currency bought ¥141.12, well up from ¥140.43 on Thursday.

The dollar's gains reflect the increasing divergence between tightening US monetary policy and expectations for further easing by the Bank of Japan and European Central Bank.

The euro held steady despite a lower-than-expected uptake of the European Central Bank's first tranche of loans to banks.
 

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
19.08
-0.9%
Rand - Pound
24.03
-0.6%
Rand - Euro
20.57
-0.5%
Rand - Aus dollar
12.38
-0.2%
Rand - Yen
0.13
-0.9%
Platinum
890.97
-0.7%
Palladium
988.99
-1.3%
Gold
2,195.56
+0.0%
Silver
24.43
-0.9%
Brent Crude
86.09
-0.2%
Top 40
67,885
+0.3%
All Share
74,077
+0.2%
Resource 10
56,208
+1.0%
Industrial 25
103,636
+0.4%
Financial 15
16,471
-0.3%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders