Central Bank to Tackle Crisis, But Impact Shock Brexit Survive

Trying to cope with a slump appears Sterling against the US Dollar this morning (25/6), after plunging 10% to its lowest level in 31 years after the announcement of the referendum results Brexit. However, the currency is still at a low level due to the widespread market uncertainty. Other foreign currency was not yet out of the upheaval.



Uncertainty Impact Press Brexit Sterling And EuroThe pound last observed moving in the range of 1.3665 against the US dollar, rising from 1.3228 record low levels. Traders interviewed by Reuters said that the BoE Mark Carney leadership statement about the readiness of the central bank to provide extra support has helped restore Sterling.EUR / USD also climbed from 1.0914, its lowest level in nearly four months, to around 1.1100an. Nevertheless, analysts expect political and economic turmoil after Brexit will last for months. Because the market is still nervous face of uncertainty about how central banks will react to respond to selection of the UK, how they impact the economic growth of the region, and whether this will be a precedent for countries other woods to come out of the EU.Richard Scalone of TJM Brokerage Chicago told Reuters, "The uncertainty is still at a very high level". Sterling warns he could slumped to $ 1.28 at the end of the year, while the euro could slip to below parity against the dollar. Multinational bank BNP Paribas is predicting the consequences Brexit expand. Although inflation is expected to rise, the BoE projected to cut interest rates from 0.5% to 0%, enable the injection of liquidity, and add as much as 100 billion QE GBP.

Safe Haven Responding to DiverseMeanwhile, uncertainty would encourage Dollar and Yen to rise because of the high demand for safe haven. Yen, in this case, still the main choice of market participants. USD / JPY was observed still in a position slipped 3.5% to 102.38, after touching its lowest level in two and a half years at 99.11.Speculation will the Bank of Japan intervention to stem the yen's rise, but so far officials Sakura new country just talk. Finance Minister Taro Aso reportedly said that Prime Minister Shinzo Abe has instructed him to cooperate with the Bank of Japan as well as coordinating with G7 counterparts in responding to market movements. At the same time, he expressed his dislike of excessive volatility in the forex market and that it will respond to the movement of the market when needed.On the other hand, the dollar jumped to 0.9726 against the Swiss franc after the Swiss National Bank (SNB) became the first major bank to intervene and devalue its own currency. The dollar index (DXY), which measures the strength of the greenback against six other major currencies, was observed to increase by 2 percent to 95 473, just a little slip of the highest peak in three months at 96 703.