The United Kindom (UK) has voted to leave the European Union (EU) in an historic referendum ending a 43-year old alliance. Britain would be the first country to leave the EU since its formation.
The 'leave' camp has received 52 percent - more than 7.7 million votes versus 48 percent for the 'remain' camp, which has 7.2 million. The referendum turnout was 71.8 percent.
The pound early Asian session hit a yearly high above 1.50 before plunging to a 31-year low in its biggest fall on record as market reacted to results. It was even bigger than on 'Black Wednesday' in 1992 when George Soros was instrumental in pushing the pound out of the Exchange Rate Mechanism introduced in the early 1970s.
Volatility has been the theme of the year. Today is one of the most volatile day of the year. Volatility increased when Asian markets opened and reacted as results vote count tricked in. World markets were highly volatile. The UK stock market down some 8 percent at the London open.
The World Bank and the IMF had warned the possibility of the UK slipping into recession. Many Economic analysts has also warned on the consequences of leaving the EU.
David Cameron has reacted to EU referendum defeat saying he would resign in October. He said "We should aim to have a new PM in place by start of Conservative Conference in Autumn." He also said that 'talks with the EU will begin under new PM, who will decide when to trigger Article 50'. The devastated Prime Minister, David Cameron reassured markets, investors that the 'British economy is fundamentally strong '.
The process of United Kingdom leaving the 28-nation European Union could take a minimum of two years. As it stands out now, a new chapter has now been opened in the United Kingdoms history.
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