Pound hits 7-year low amid Brexit panic

UK-Currency-Money-Coin-Pounds-GBP-700x450The pound has hit a seven-year low against the dollar, as fears about the UK leaving the European Union made investors nervous.

Yesterday the pound had dropped by 2.4 per cent at its lowest to hit $1.4059, dropping lower than the $1.4079 low on January 21st. The drop marked its weakest rate against the dollar since March 2009, when the Bank of England cut interest rates to 0.5 per cent.

The drop yesterday establishes the pound’s position as the worst performing currency in 2016 so far, being down 3 per cent since the start of the year.

The currency weakness came as Moody’s warned that a Brexit would be more negative for the UK economy than positive.

It warned that leaving the EU could lead to a downgrade of the UK’s credit rating, adding that the result of the referendum on June 23rd is “too close to call”.