Global stocks rose sharply today and sterling strengthened broadly while safe-havens including the yen and gold retreated, after polls showed support for Britain staying in the European Union regaining momentum before Thursday's referendum.
Sterling rose half a percent in early London trading today and the euro added to gains in the past 24 hours on expectations that the killing of a pro-European Union British lawmaker may alter the balance of opinion in Britain's referendum on EU membership.
Yesterday’s tragic killing of Labour MP Jo Cox saw both Brexit and Leave camps suspend their campaigns. This led to speculation that the Leave camp will now lose support and the bookies cut their odds for Brexit and British pound staged a short-covering bounce accordingly.
Risk remained out of favour this morning as stocks tumbled and safe haven government bonds extended their rally, causing yields on the 10-year German bunds to drop below zero for the first time. In Britain, the equivalent yields have also fallen to a fresh record low level. Ahead of the above fundamental events, the euro/U.S. dollar (EUR/USD) currency pair has reached a key technical level today, namely around 1.1210/20.