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Pound plummets against dollar as polls suggest Brexit and Cameron warns of economic 'bomb'

'Add those things together – the shock impact, the uncertainty impact, the trade impact – and you put a bomb under our economy,' says PM

Published 06/06/2016

David Cameron challenged Vote Leave to produce an economic plan
David Cameron challenged Vote Leave to produce an economic plan

The pound fell sharply against the dollar as financial markets reacted badly to new polls suggesting momentum is moving towards Britain’s exit from the European Union.

David Cameron used a campaign event this morning to warn that Brexit would detonate a “bomb” under the British economy from which it would take years to recover.

The Prime Minister's remarks appeared to be borne out by market reaction to two polls suggesting that more voters are now inclined to leave the EU than stay in.

Sterling lost as much as 1.1 per cent against the US dollar, falling to a three-week low, even in the face of weak economic data in the US.

“Were Brexit to occur we see a real risk of a sterling crisis against the backdrop of twin fiscal and current account deficits,” Mark Dowding, co-head of investment grade debt at BlueBay Asset Management told the Financial Times.

Appearing with Harriet Harman, Natalie Bennett and Tim Farron Mr Cameron said leave campaigners were prepared to make things up to persuade people to opt for Brexit.

He said there would be a recession, years of uncertainty and weaker trade in the event of Brexit, and the leave campaign had failed to set out how it would deal with those consequences.

“Add those things together – the shock impact, the uncertainty impact, the trade impact – and you put a bomb under our economy,” he said. “And the worst thing is we’d have lit the fuse ourselves.”

“Don’t throw away your job, don’t throw away your children’s futures, don’t throw away the strength and future of our country on the basis of misleading statistics peddled by a campaign determined to say anything and indeed everything to get the outcome they want,” he said. “That is what is happening. Do not be misled. Do not let them persuade you of this reckless course for our country.”

Cameron said the event in London was an “unprecedented show of cross-party unity”, and branded the out campaign “undemocratic and reckless” because it had not set out what a vote to leave would mean.

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