The pound tumbled to an eight-week low early on Monday (13 June) as concerns grew over the outcome of the European Union referendum, which could see Britain leave the 28-country bloc later this month.

The British currency, which on Friday recorded its second-biggest drop this year after tumbling 1.4%, lost a further 0.5%, falling as low as $1.4159 on Monday, its weakest level since 18 April. It then recovered some ground and, as of 7.30am BST, was trading up 0.2% against the US dollar and was unchanged against the euro.

More business news

"It would appear that the continued hyperbole of both campaigns, along with the daily dose of claims of financial apocalypse appear to be getting tuned out as voters tire of the slow drip of absurd claims by various politicians from both sides of the debate," said Michael Hewson, chief market analyst at CMC Markets.

"This shift in sentiment away from the complacency just over two weeks ago when it was widely expected that the "remain" camp would probably carry the day, has spooked already anxious markets."

With 10 days to go until Britons head to the polling stations, the latest polls give the 'Leave' campaign a slight lead over the pro-European movement, as momentum behind the former campaign continues to grow.

On 10 June, a Financial Times' poll of polls put the 'Leave' campaign ahead 46% to 44% and analysts indicated the longer the uncertainty lingers on, the worse the impact on the markets is expected to be.

"I would expect volatilities to rise further and the markets will become even bleaker as we head towards the referendum," said Koichi Yoshikawa, executive director of finance at Standard Chartered Bank.

EU Referendum Brexit