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Fresh opinion polls from the UK continue showing a very tight race between the Remain and the Leave camp.  In fact,  each poll can encourage a different camp and the undecideds can break both ways.

The British political scene re-focuses on the June 23rd EU Referendum after a pause for the local elections. Prominent polling firms are back in the game and so are politicians. The de-facto leader of the Leave campaign, Boris Johnson, compared the EU to the continent’s worst conquerors, including Hitler. This resulted in some support and a lot of harsh criticism, comparing Johnson to Donald Trump.

Does this affect polling? At the moment, polls offer a bit for every one:

YouGov/Good Morning Britain – Remain 42%, Leave 40%, Don’t know/won’t vote 19% (tabs)
ICM – Remain 44%, Leave 46%, Don’t know 11%

And it gets even tighter if you look at an aggregate of polls set up by The Economist here:

UK EU referendum economist poll tracker May 16 2016

Brexit, GBP and EUR

The pound is sensitive to opinion polls: a strengthening of the Remain campaign is positive for sterling and momentum for the Leave campaign is pound pounding.

Yet these kind of mixed results offer little to move the pound. Against the greenback, GBP/USD is gently slipping lower, extending the moves seen beforehand but certainly not going anywhere fast. 1.4280, 1.4230 and 1.4050 serve as lines of support. Resistance is at 1.4440 and 1.4510. The pivot line remains 1.4350.

GBPUSD May 16 2016 slipping on even Brexit polls

It is also interesting to note that the euro is trading more closely to the pound. This may be a coincidence, and mostly reflects the dollar up / dollar down trend we are seeing recently in markets. All currencies either rise or fall against the greenback.

But it may also reflect the  political scene: an exit of the UK from the EU is big trouble for the EU. It could be the beginning of the end of the European Project, with other countries also reconsidering their membership.

The  events of the Greek crisis in 2015  left many scars. Discontent is evident in Spain with a hung parliament, in Austria’s presidential elections, and the rise of the extreme right in France and recently in Germany.

And speaking of Greece, former finance minister of Greece Yanis Varoufakis phrased it  nicely: the EU is not a golf club  that is always there, and to which you can sign in and out. A  Brexit  Blow to the EU could be fatal.

Here is  the steady trade on EUR/GBP:

EURGBP steady Brexit fears May 2016