Wealthy Nations Daily Update - Boris Johnson / Brexit

“Once-in-a-lifetime opportunity” were the words used by London Mayor and Conservative MP Boris Johnson when he announced that he will back the campaign calling for the UK to leave the EU. Talking to reporters outside his house yesterday he said that, “after a huge amount of heartache” he will be “advocating Vote Leave, or whatever the team is called, because I want a better deal for the people of this country: to save them money and take back control.”  

His decision to throw his weight behind the no campaign after weeks of sitting on the fence came after he said that Prime Minister David Cameron had failed to deliver fundamental reform with the EU over the last few weeks. He defended his choice saying the last thing he wanted to do was to go against his own Prime Minister or the government, however he felt he had to do what was right because he wanted a better deal for the UK. However, he has said  will not take part in any debates against members of his own party.

Downing Street has not been slow in its response saying, “Our message to everyone is we want Britain to have the best of both worlds: all the advantages of the jobs and investment that come with being in the EU, without the downsides of being in the euro and open borders.” Perhaps more interestingly Lord Heseltine, the former conservative deputy prime minister was not slow to offer his opinion. He has backed the cause for the UK to stay in the EU and said of Johnson, “Given that Boris has spent so long agonising over this decision, his decision is illogical. If it takes you this long to make up your mind about something so fundamental and you still have questions, then surely the right option is to stay with what you know rather than risk our economy and security with a leap in the dark.” On the back of the events yesterday, one person never slow to get her name in the headlines; Nicola Sturgeon, said a vote to leave the EU against Scotland’s wishes would “almost certainly” trigger another independence referendum.

At the time of writing and on the back of Johnson’s announcement, sterling dropped 2.33% against the USD in its biggest decline in over a year, as well as falling 1.26% against the Euro. In total the pound has fallen 4.66% this year versus the USD. Moreover if you’re interested, the odds of the UK parting company with the EU shortened last night. Ladbrokes were offering 12/5, however that price has now come into 2/1 and Boris has also become the favourite to be the next leader of the Conservative Party. However, we believe his chances of that will very much depend on how the UK votes on the 23rd of June.