Do you see international currencies giong down as a result of Brexit?

Tiras25
Tiras25 used Ask the Experts™
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Planning my travels abroad and looking into the budgets.  Any currencies went down or going down as a result of UK exit from EU?  
Asian currencies (thai, japanese, vietnamese),  Eastern European or Russian Ruble?

Thanks.
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Senior Software Developer
Commented:
In the short term, absolutely. Economic uncertainty always drives financial markets down.

It is likely that all economies outside Europe will recover relatively quickly. What remains to be seen is if the British Pound will rebound completely and how much value the Euro will lose in the world market as a result.

Great Britain has one of the strongest economies in all of Europe so its departure from the EU should effectively dilute the Euro's strength.
Commented:
I agree with Russ.
One world order sucks and I am relieved to see interest in abandoning it
Top Expert 2016
Commented:
It should not affect currencies outside of the EU or GB. in times of uncertainty people move out of the currency market and into markets like gold. GB is only 1.9% of the EU's strength.
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Most Valuable Expert 2015
Commented:
It's mainly the pounds and the Euro that will go down. The Swiss Franc on the other hand tends to get stronger, although the Swiss national bank is taking counter measures. With other currencies it will mainly be those that are regarded as being "stable", which will go up, as the Brexit pessimists will want to invest in stable currencies. The others can go in any direction, depending on their country's connection with the EU and with other currencies.

I expect the Pounds to regain strength sooner than the Euro.
UK hasn't exited yet, it's just expressed a wish to. It will take a couple of years to actually happen. Initially there will be some wild fluctuations and probably again immediately leading up to the actual divorce. In the middle period I expect things to remain relatively stable with a slow rise or fall.
Most Valuable Expert 2015
Commented:
I think they have exited. The vote makes that clear. Of course it will take some time to get all the formalities going. But the decision has been made and must be accepted. That is democracy.
Russ SuterSenior Software Developer

Commented:
Rindi,

It's not over yet. The vote was fairly close and may be revisited. GB may yet change its mind. That being said this seems to be a largely symbolic gesture as GB has maintained an arms-length relationship with the EU since the beginning. Certainly they won't have to follow ALL of the EU rules any longer but they will still have to follow most of them in order to be able to buy and sell products throughout Europe.
Top Expert 2016
Commented:
GB still has to put into effect article 50 of the Lisbon Accord to start the 2 year timer to negotiate leaving the EU
@rindi >>I think they have exited. The vote makes that clear. Of course it will take some time to get all the formalities going. But the decision has been made and must be accepted. That is democracy.

They have not yet exited, the referendum held June 23 expresses the wish to leave the EU (52 to 48 per cent for the leave side). Now Great Britain must
trigger Article 50 of the EU's Lisbon Treaty, which will begin the two-year exit process to renegotiate trade, business and political links between the U.K. and what will become a 27-nation bloc.
(http://www.cbc.ca/news/world/brexit-eu-meeting-saturday-1.3652703)

I think that, with globalization the way it is, this will affect all money markets world-wide.
Most Valuable Expert 2015

Commented:
Before the vote everyone, from the Official EU to British politicians said the vote would be definitive. So it has been decided. Besides, Cameron has already announced his demise. There is no way to change form Brexit to Brbackin. Maybe Scotland and Ireland will go a separate route and go for the EU, But England and Wales won't.
It's like a divorce―the parties have decided to split up, but it isn't official until all the papers have been served and are signed.  Of course it is going to happen, that much was decided last Thursday.
Russ SuterSenior Software Developer

Commented:
Maybe Scotland and Ireland will go a separate route and go for the EU, But England and Wales won't.
Before that happens Scotland and Ireland would have to separate from Great Britain. Scotland had just such a vote in 2014 and the referendum failed. Until such a referendum passes all 4 nations of Great Britain are bound.
In fact, the Republic of Ireland remains in the EU, however Northern Ireland and Scotland must follow Great Britain's lead and leave.

This of course will require that there be a 'hard' border (i.e. manned border crossings) between Republic of Ireland and Northern Ireland to prevent all those pesky migrants from entering Great Britain through Northern Ireland.
Most Valuable Expert 2015

Commented:
I think Scotland will go for a new vote. The main reason they stayed in the UK the last time was because of the EU, and that is gone now. The same could happen with northern Ireland, they could want to join with Ireland.
Top Expert 2016

Commented:
When one looks at a currency losing value one has to have a reference currency to compare against. In most cases, the USD is the reference currency.  Most banks have a currency exchange unit and they will trade on differences between one market and another even if the difference seems microscopic.  They also borrow/lend monety with other banks on a continual basis (if they have more money available than what they legally must have they will lend and if withdrawals exceed expectations they will borrow, these trades happen on a continual basis. One half a percentage point when one is dealing with billions is still a lot of money.

Commented:
Great Britain has one of the strongest economies in all of Europe so its departure from the EU should effectively dilute the Euro's strength.

First GB is not in the Euro, but it's GDP is 18% of the EU GDP so it will have an effect on the Euro, but that effect will be far less than on the pound. And that is exactly what we have seen in the last days.

It is to an extent true that the UK has a strong economy, but that is primarily based on growth forecasts. It has been running a balance of payments deficit since 1983 which has been partially relieved by foreign investment. This investment has been made primarily because the UK is in the EU, that it has a largish economy and of course there is the language issue. But the UK will now no longer in the EU and some of that investment will go to Ireland and probably the Low Countries. The UK banking sector's euro operations will be split between Paris, Frankfurt and Luxembourg, so the city will probably retain its dominance albeit somewhat reduced.

But the decision has been made and must be accepted. That is democracy.

Well I won't accept it. My husband is British and has been outside the UK now for almost 40 years - exercising his RIGHT under UK/EU law. But the 15 year rule excluded him and a great deal of others from voting.

GB still has to put into effect article 50 of the Lisbon Accord to start the 2 year timer to negotiate leaving the EU

Given the comments made by various Tory politicians - Michael Gove saying he won't put in Article 50 till the beginning of next year - it looks like the UK is trying to blackmail the EU into giving them a good trade deal. Given the fact that during the campaign Brexit meant Exit, I think they should exit as fast as possible and onto WTO regulations and we'll see after that. I know that Jean-Claude Juncker will be glad to see the back of Nigel Farage.
@Rindi
>>> I think Scotland will go for a new vote. The main reason they stayed in the UK the last time was because of the EU, and that is gone now" <<<

No, the main reason WE voted to remain as one of the 4 countries that make up the United Kingdom is because sensible Scottish people realised that there was more strength in unity, not because Scottish people necessarily wanted to remain as part of the European Union.  That particular issue was not really being discussed when the referendum was held in Scotland to see if the people wanted to separate from the EU.  Scotland had already been granted some autonomy by way of devolution, and that was seen by the majority of Scots as being a good balance rather than becoming a completely independent country.

You have to bear in mind that Scotland lost a lot of its industry over the preceding decades.  Its fishing fleet was bound by EU curfews and quotas whilst factory trawlers from other EU countries depleted stock in Scottish waters; the coal industry went down the toilet during Margaret Thatcher's régime; half of the Scotch Whisky brands are now owned by large multinational companies; the British Steel industry (which had a large number of production plants based in Scotland) was sold off to a Dutch company and then to an Indian one and almost all the plants closed; many of the call centres that were a flourishing new industry in the larger Scottish cities relocated to India; Air Force bases in Scotland were closed in favour of retaining English ones; the shipbuilding industry that once made the River Clyde known throughout the world is now almost non-existent; the North Sea oil industry off Scotland's shores has taken a severe nose-dive; and a whole lot more.

Of course the loss of some of these industries has affected the whole of the UK and not just Scotland, but Alec Salmond the Scottish First Minister on the lead-up to the Scottish Independence Referendum (and the predecessor of the current Nicola Sturgeon - something fishy about those two) kept trying to insist that Scotland would have sufficient wealth to function as an independent country when realistically it cannot.  Sensible Scots thought about such things as where the money would come from if Scotland suffered such severe flooding as England had suffered in the years before the referendum.  Part of Scotland sits right on fault lines and could easily be hit by an earthquake at some point in the future.  Being part of the United Kingdom gives each of the separate countries financial strength in numbers.  Scotland could have been rich at one time as an independent country, but not now, and people who gave the Independence Referendum enough thought realised this to be the case and foresaw large hikes in their Income Tax, etc.

One of the main reasons that Scotland voted across the board for the united Kingdom to remain as an EU member is most likely because agriculture is so important to the economy, and EU subsidies help farming and rural infrastructure, especially on remote islands that depend on subsidised ferries.  Another of the reasons is that Scotland has not seen the same number of problematic migrant workers from the EU and elsewhere as England has in the last decade, and being swamped by job-stealing benefit-claiming migrants was used as a significant scare tactic by the "leave" campaigners in the so-called "Brexit" referendum.

In the same way that the results of the "Brexit" referendum must be ratified and agreed by the UK parliament before the decision becomes legal, the United Kingdom parliament will have to decide whether the Scottish National Party's bid to stage another Independence Referendum would be allowed.  Nothing in the UK is legally binding unless it is agreed by the UK parliament, and that includes/included EU Directives, and Scotland is still part of the UK as voted by the Scottish people a few years ago.
Most Valuable Expert 2015

Commented:
Had Scotland gone for independence, they wouldn't have been in the EU anymore and they would have had to apply for a membership, which wouldn't have been guaranteed, and probably would have taken some Years to get processed. As the UK was a member of the EU at the time I think that was the main reason they voted to stay in the UK at that time, as Brexit wasn't yet an issue then.

Commented:
I'd dispute the fact that Scotland couldn't become independent. It's all a matter of attitude. Just look at us in Luxembourg. First Belgium became independent from Holland and we did. And we haven't done badly out of it since.

As far as I am aware, the Brexit referendum does not have to be ratified by parliament (I'm all in favour of Ratification!), it seems like the PM can do it on its own and given that the Tory leadership is now down to one person it seems that all of this shattering change is going to take place without any further elections.

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