David Cameron resigns with markets in shock after UK votes to leave EU

- Leadership - Jun 24, 2016

The United Kingdom has voted in favour of leaving the European Union as Prime Minister David Cameron resigned shortly after the result of the referendum confirmed.

With the markets having made their position clear when polls closed at 10pm on Thursday, the pound reaching as high as $1.50, it soon became clear financiers had failed to call the outcome. The final results show leave on 52 percent of the vote, a margin of 1.3 million over remain.

Initial economic shockwaves have been felt, not least by a dramatic drop in the pound to levels not seen since 1985, made all the more dramatic by what now seems misguided optimism held on the eve of counting.

Ratings agency Standard and Poor's said Britain's "AAA" credit rating is no longer tenable after voters opted to leave the European Union.

However, Bank of England Governor Mark Carney said it is prepared: “The people of the United Kingdom have voted to leave the European Union. Inevitably, there will be a period of uncertainty and adjustment following this result. There will be no initial change in the way our people can travel, in the way our goods can move or the way our services can be sold.

“And it will take some time for the United Kingdom to establish new relationships with Europe and the rest of the world. Some market and economic volatility can be expected as this process unfolds.

“But we are well prepared for this. The Treasury and the Bank of England have engaged in extensive contingency planning and the Chancellor and I have been in close contact, including through the night and this morning.

“The Bank will not hesitate to take additional measures as required as those markets adjust and the UK economy moves forward.

“These adjustments will be supported by a resilient UK financial system – one that the Bank of England has consistently strengthened over the last seven years.

In a speech made outside of Number 10 Downing Street, David Cameron said: “We must now prepare for a negotiation with the European Union. This will need to involve the full engagement of the Scottish, Welsh and Northern Ireland governments to ensure all parts of the UK are protected and advanced. Above all this will require strong determined and committed leadership. I'm very proud and very honoured to have been prime minister of this country for six years. I believe we've made great steps."

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Read the June 2016 issue of Business Review Europe magazine.

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