Derek Hakpenny, European Head of GMR at MUFG, suspects the UK balance of payments statistics released this morning will garner more attention than usual given the upcoming EU referendum that leaves the pound vulnerable to the increased uncertainty. Key Quotes “As the BOE FPC statement pointed out this week, the pound is vulnerable due to its large current account deficit that requires foreign investor financing. A vote to exit the UK could mean this foreign financing dries up leaving households and corporations with higher financing costs that could undermine economic activity. The UK current account deficit totalled GBP 86.7bn in the four quarters to Q3 last year, some 4.7% of nominal GDP. That was easily financed on the financial account side with still notable inflows through FDI. Any signs of a change in today’s report will quickly be highlighted as a potential sign of slower capital inflows due to ‘Brexit’ uncertainty. In reality though we will only truly see the impact of ‘Brexit’ risk in Q1 data given it was only late December when speculation picked up and only February when we had official confirmation of the referendum taking place this summer. That Q1 data will be released on 30th June after the referendum takes place on 23rd June!” For more information, read our latest forex news.