Greek vote: what will a ‘no’ mean for sterling and the euro?
Andy Scott, associate director of FX advisory services at foreign currency specialists, HiFX, comments on what a Greek referendum ‘No’ vote will mean for sterling and British holidaymakers.
“With indications that Greeks have voted ‘no’ in the referendum, the country looks set to be plunged into grave financial uncertainty. Greece’s stay of execution may at last be over and it will be forced to reintroduce a national currency. The short term impact for the euro is likely to be a fall across the board when markets begin trading in Australasia later on this evening, though since it won’t come as a complete surprise, the damage may be limited slightly to just a couple of percentage points. The medium term picture is less clear since no mechanism exists for a country to exit the single currency and so a lot will depend on how well they manage a ‘Grexit’.
“For anyone holidaying in Greece this summer you may well experience a saving on your holiday money since the Euro could weaken, and a return to a national currency would likely lead to a significant devaluation. However, it’s also worth remembering that what Juncker and co. say, and what they actually do could be completely different. They are politicians after all. We may still be talking about Greece as the bad relation of the currency block in months to come, but let’s hope not!”