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    Sterling plunges to new bottoms on Brexit fears

    British pound sank to a new 31-year low on Wednesday, while the Japanese yen surged on escalating fears of the broader impact of U.K.’s vote to leave the European Union.

    The sterling plunged to 1.2798 against the dollar, breaking below the trough of 1.3000 touched overnight. It was last down 1.2% to 1.2867.

    The single currency climbed to as high as 86.26 against the sterling, its highest level since August 2013 and was last up 0.9% at 85.76.
     
    Against the yen, the cable dropped to as low as 128.81, its lowest level since November 2012. It was last trading down 2.2% to 129.61.

    The greenback fell to 100.58 against the safe-haven yen, drifting away from Friday’s post-Brexit peak of 103.40. It was last trading down 1% at 100.72, holding above the bottom of 99.000 touched in the aftermath of the vote.  
    The common currency retreated below 112.00 against the yen for the first time in a week, to a session trough of 111.03. The cross was last up at 111.68.  

    Three British commercial property funds of 10 billion pounds suspended trading this week, after the U.K.’s vote to exit the EU sent asset prices to plunge.

    In addition to that, stocks in Italy’s banks, which are drowning under a pile of non-performing loans, plummeted on Tuesday, fueling concerns over increased market instability.
     
    The Aussie fell, through it traded relatively better than some other peers despite the renewed risk aversion, due to the attractive Australian bond yields. The Australian dollar dropped 0.38% to 0.7434, after reaching the high of 0.7545 in the previous session.
     
    The Kiwi retreated 0.82% to trade at 0.7095 against the dollar, the lowest since the 30th June. The commodity-linked currencies were under pressure after oil prices fell sharply on Tuesday.
     
    The U.S. dollar index, which tracks the greenback’s performance against a group of six other currencies, was last up 0.09% at a one-week high of 96.36.
     

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