The pound today fell to its lowest level in two years against the euro, dragged down by political and economic uncertainties triggered by the surprise victory for 'Brexiteers' in last Thursday’s Referendum.
By mid-morning, the pound had fallen 2.17% against the dollar to $1.336, and 1.64% down against the euro with one pound buying just 1.211 euros on the London foreign exchange market.
On the London Stock Exchange, the FTSE-100 index was down 83.25 points to 6055.44 points.
Banking shares suffered significant declines, with trading in Barclays Bank and Royal Bank of Scotland shares temporarily suspended after both registering decreases of more than 10% whcih triggered an automatic trading 'time out'.
Finance Minister George Osborne tried to calm the markets today, stating that the UK’s strong economy will help address the difficulties related to the 'Brexit' vote and that the economy is "fundamentally strong" and "is open for business."
At the time of writing (17:27) one pound sterling was trading at 1.196 euros and 1.319 against the US Dollar.
Of deep concern to the Portuguese government is the performance of the PSI 20 which has lost over 19% this year compared to 2015 and now sits at a 30 year low.
Top stocks were sliding even before the Brexit vote but the British referendum pushed stocks lower today on top of a poor performance last Friday when markets worldwide suffered Brexit fallout.
Attention is now on Portugal as it hosts the European Central Bank Forum in Sintra with the President of the European Central bank, Mario Draghi, the president of the Bank of England and of the US Federal Reserve. If Brexit was not on the original agenda, it will be now with institutions, the press and the public keen for action, predictions, assurance and calming press conferences.
Significant sections of the Portuguese economy fears the impact of Brexit with Portuguese exports to the UK becoming more expensive and the British losing purchasing power for holidays and properties in Portugal if sterling continues to fall against the euro.
Comments
Other than the sunshine why else base this conference in Lisbon, Portugal ? It cannot be because this country is a shining example of Banking expertise and prudence.
Portugal has long combined a strange mix of Western and - left over from its historical roots - Islamic banking practices. Ostensibly like developed Western countries but the Islamic banking influence of prohibiting the charging or paying of interest shown in today's Portuguese bankers routine practice of handing over millions of euros worth of their depositors savings to their 'VIP specials' without seeking any return. Least of all collateral. As we have since seen, this practice then crashing worthless Portuguese Banks like skittles.