Sterling rose 1.6 per cent to $1.46 against the US dollar in one of its biggest rallies in a decade.
The surge follows a series of polls over the weekend that show a swing back towards the UK voting to remain in the EU at this Thursday’s referendum.
According to the FT poll of polls, leave and remain are now neck and neck at 44 per cent each.
Several polls in weekend newspapers showed “Bremain” edging ahead, including The Observer and The Mail on Sunday.
The rise in sterling was the highest since a 1.9 per cent gain in 15 October 2009, according to the FT.
Schroders head of multi manager Marcus Brookes last week said substantial weakness has been priced into sterling since March, when it stood at $1.3, compared to $1.58 in June 2015.