Analysts´ concerns around Brexit weigh on pound, further losses possible

London Mayor Boris Johnson´s support for the 'Leave' campaign in the upcoming referendum on whether to abandon the European Union appeared to crystallise analysts´ concerns that a Brexit was not wholly inconceivable.

"Still, how the package of announced reforms impact the general public's voting intentions remains unclear, as it is too early to tell if post-deal trends are developing in the opinion polls. So there continues to be much uncertainty, which can both impact the financial markets – most likely most likely the value of sterling in the first instance – and potentially the broader economy as well," UBS economist David Tinsley said in a research report sent to clients.

Analysts at Danske Bank echoed Tinsley´s view, telling their own clients that there was still "a large group of undecided voters that could alter the picture in the coming months."

"The question, which coming opinion polls may answer, is whether the UK voters are satisfied with the EU-UK deal."

"In particular, the question is whether UK voters are satisfied with the deal on immigration and welfare benefits to the EU," Danske Bank said.

Against that backdrop, cable surrendered 1.48% to 1.4146 on Monday, with technical analysts at Digital Look increasingly convinced that a move down towards 1.35 was now on the cards.