• GBPUSD opened the week with its biggest gap (134 pips) in 7 years
• The pound's tumble was sparked by an opinion poll that showed majority support for Scotland's UK exit
• While the 'shock value' has passed; the unkowns, BoE forecast shift and elevated volatility will remain
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GBPUSD opened this week with a 134-pip gap - the biggest jump for the pair in seven years. The trigger for this incredible move was a YouGov opinion poll that showed the 'low risk' scenario of Scotland voting for independence from the United Kingdom had suddenly turned material and probable with 51 percent of those surveyed saying they would vote to leave. The accuracy of the poll, shifting moods with last minute campaigning before the September 18 referendum, and market skepticism will remain going forward. However, that is unlikely to settle the market. The lack of clarity on the fallout from this event, the secondary concerns of fading BoE rate forecasts and already-elevated volatility levels in FX markets will keep the Pound on edge. We focus on the currency in today's Strategy Video.
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