EU referendum: 'Remain' vote could still trigger political instability in the UK

Britain will vote to remain in the European Union by a narrow margin tomorrow (23 June) but the outcome will nevertheless cause political instability in the UK and in the 28-country bloc, according to Citigroup analysts.

The Leave campaign has gained strong momentum over the past couple weeks but, with less than 24 hours to go until the historic vote, economists at the US investment bank said they still expected Britain to remain in the UK.

"We see a 60% chance that the majority of British voters will choose Remain in the 23 June EU referendum," Citi analysts said.

"A Close Remain (our base case) could still undermine UK/EU political stability."

The investment bank also warned that, in the event of a Brexit, the repercussions on financial markets could be substantial.

"A vote to Leave would have major repercussions in global financial markets, the economy and politics, triggering substantial downward revisions of UK and European growth forecasts," analysts added.

The warning came as Jonathan Hill, EU's financial services commissioner, stressed that leaving the EU could deal a severe blow to the UK's financial sector. According to Hill, a number of international banks could relocate their workforce to Paris and Frankfurt, should Britain vote to leave the 28-country bloc.

"I've visited London, Manchester and other British financial centres in the past weeks and warned of the consequences of an exit from the EU," he said.

"Then it could happen that banks and investment funds shift activities and jobs to Frankfurt and Paris."

Meanwhile, the two campaigns are locked in a race that remains too close to call.

The latest telephone opinion poll from Survation, of more than 1,000 people on 20 June, put Remain on 45% and Leave on 44%, with 11% of respondents undecided. Odds on Britain remaining in the EU stand between 1/4 and 2/7 with the UK's major bookmakers, while a pro-Brexit vote is currently 3/1.