Pound sinks as 'leave' vote rises in Brexit polls

Anti-UKIP protesters come face to face with the party's supporters in Northampton.
A two Euro coin is pictured next to a one Pound coin on top of a portrait of Britain's Queen Elizabeth in this file photograph illustration.
A two Euro coin is pictured next to a one Pound coin on top of a portrait of Britain's Queen Elizabeth in this file photograph illustration. PHOTO: REUTERS

NEW YORK (AFP) - The pound sank against the US dollar and euro on Tuesday (May 31) after fresh polls showed British voters more in favor of quitting the European Union.

Just over three weeks before the referendum on pulling out of the EU, the Guardian/ICM polls showed the "leave" vote at 52 per cent against 48 per cent for staying, a surprise reversal in sentiment.

The poll matched the trend seen in other surveys. For example, the Financial Times survey showed the "stay" vote still ahead but the gap between the two narrowed to three percentage points from six points a week ago.

That rekindled nervousness in markets, where breaking from the 28-country union is seen as likely to spur significant markets turmoil and slow or stall the British economy.

The pound sank by 1.0 per cent to US$1.4478, and the euro also gained 1.0 per cent at 0.7689 pence.

The dollar was little-changed against the euro despite mostly good economic data on rising home prices and a rebound in consumer spending that supported the Federal Reserve moving to raise interest rates in the next two months.

CME fed fund rate futures put a 22.5 per cent likelihood on an increase at the Fed's June 14-15 meeting, while the odds for a July 26-27 meeting rise were nearly 60 per cent.