Irish bank shares and sterling hit amid Brexit political chaos
Irish bank shares and the pound fell sharply yesterday as investors confronted the possibility of a no-deal Brexit.
With Ireland’s economy significantly exposed to a no-deal scenario, Permanent TSB lost almost 6.5pc, AIB lost 5.35pc and Bank of Ireland lost 4.87pc – all serving to reduce the value of the taxpayers’ remaining holdings in those banks.
The pound fell as much as 1.5pc versus the dollar as the political turmoil showed no sign of easing, with French President Emmanuel Macron saying that if British Prime Minister Theresa May’s plan fails to get parliamentary approval again it would “guide everyone to a hard exit”.
The pound could slump about 8pc from current levels if the UK left without a deal, according to a Bloomberg survey. “The possibility of a ‘no deal’ Brexit has increased,” said Calvin Tse, North American head of G10 foreign-exchange strategy at Citigroup.
“They are likely to scrape something together at the last minute, but the risk remains that we fall over the cliff.”
Additional reporting Bloomberg
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