Concerns rose about a possible Brexit, after David Cameron scheduled a referendum, those fears are justified according to analysts from Wells Fargo. Key Quotes: “Brexit” fears came to the fore last week as Prime Minister David Cameron scheduled a referendum on the issue for June 23. The British pound subsequently fell to a 7-year low and has since settled around this lower level. This depreciation in sterling likely reflects uncertainty around the implications of a potential British exit from the European Union “It is impossible to quantify the exact effects Brexit would have on the U.K. economy. However, extensive trade ties, cross-border investment and the free flow of individuals between the United Kingdom and EU member countries could be at risk. London’s status as the financial capital of Europe could also be in jeopardy. Whatever the outcome, there is no precedent for such an event and any negotiations in the aftermath would likely be lengthy and challenging.” “Financial markets have clearly grown increasingly worrisome of the potential for a British exit from the European Union in recent weeks. In our view, this fear is justified.” “Should Brexit occur, the outlook for economic activity in the United Kingdom is highly uncertain both in the short term and over the longer term.” For more information, read our latest forex news.