UK Head Fake: Vote for Exit?
Justin Burkhardt | FXFocus.com
Is Britain “drifting toward the exit”? That’s what British Prime Minister David Cameron is gunning for in his proposed referendum unless change occurs first.
In a meeting in London today, Cameron stated that there has to be “fundamental change” within the EU for the UK to remain a part of this Union. (Read more…) But he will likely not get the change that he is demanding…
The proposed vote is still 4 years out and is of course contingent upon Cameron being re-elect in the 2015 general election. Today’s pledge has done little to ease the tension that has been stirring and will likely further alienate the UK from the euro-zone.
Cameron is not the first to propose a referendum like this one. Greece’s former prime minister, George Papandreou, tried to play the same card back in 2011; within days he was overthrown by his own party.
It would seem very unlikely that Britain will actually follow through with an exit here given the economic benefit of being a part of this union. However, a recent opinion poll showed that a swelling camp of Euroskeptics ready to walk.
For the last week the GBP.USD has been in a downward spiral likely hit by a dampening of investor confidence in light of exit talks coupled with poor economic data streaming out of the region. The pair has fallen from a peak of 1.6383 to a low of 1.5800 and is now consolidating near the $1.5824 support level. What is the next play here, a continuation the current trend or an outright reversal?
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[VIA Zero Hedge]