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Pound plunges as sterling feels heat of Brexit vote

The pound fell against the dollar and the euro on Monday morning. Credit: PA

The value of the pound continued to plunge on Monday morning as concerns over the state of the British economy deepened following Brexit.

The pound fell 3.35% against the dollar to $1.32, following on from Friday's 10% drop. Against the euro the pound was also down, falling 2.27% to €1.20.

It comes as George Osborne sought to calm market fears in an early morning speech on Monday, in which he said the UK economy is "open for business" and "about as strong as it could be".

Ken Odeluga, market analyst at City Index, said: "Osborne was of course not yet able to provide any further material certainty on key procedural questions (particularly when Article 50 will be triggered) facing Britain, and consequently its markets, over the next several months.

"It is uncertainty surrounding such questions that are contributing to sterling's softness."

Boris Johnson: 'Project Fear is over'

Boris Johnson said "Project Fear is over" after the Chancellor George Osborne said an emergency budget was unlikely to happen until David Cameron's successor takes over in the autumn.

The leading Leave campaigner welcomed Mr Osborne's statement on Monday morning that the UK economy was "about as strong as it could be", as the chancellor tried to calm fears in the markets about the economy post Brexit.

"It is clear now that Project Fear is over, there is not going to be an emergency budget, people's pensions are safe, the pound is stable, the markets are stable, I think that's all very good," Mr Johnson told reporters as he left his London home.

The former Mayor of London also said EU citizens currently living in the UK and British expats living on the continent "have their rights protected", as he sought to clear up "confusion" over their "status".


FTSE 100 down as bank shares plunge

The FTSE-100 index was down 60.01 points to 6078.68 at 9.15am, as RBS, Barclays and Lloyds suffered falls in their share value.

ITV News Business Editor Joel Hills has the latest:

The FTSE 100 top fallers as at 10.20am Credit: FTSE

Joe Trundle, Head of Trading at ETX Capital, said: "Banks are being hammered as a result of Britain’s decision to leave the EU. Aside from the general investor uncertainty, there are some important reasons why financial stocks are so exposed.

"First, there is a realisation that interest rates will remain low for longer – gilts have sunk below 1% for their first time ever today. This is not confined to the UK - Australia’s central bank may have to cut rates because of the vote.

"Second, property assets will have to be revalued and that could severely dent banks’ loan books.

"Thirdly, British banks probably won’t have access to EU markets post-Brexit as they’ll lose their 'passporting' privileges.

Osborne to clarify if he will run for leadership this week

George Osborne said he would clarify whether he would run for leadership of the Conservative Party this week.

Speaking at a news conference in London on Monday morning, the Chancellor said: "There have been questions about the future of the Conservative Party and I will address my role within that in the coming days."

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