Belgium blasts trigger risk aversion, bad for Pound

Multiple explosions in Brussels Airport, which is capital city of Belgium, home to European parliament, headquarter of NATO has triggered a risk aversion in financial markets. As of latest reports, two explosions have hit airport and one people is being reported as dead. Belgian government has activated emergency plans and increased the threat alert to four, which is highest and means an attack is imminent.

Safe have assets such as bonds, gold, Yen are higher, while investors sell equities, Euro and Pound. German DAX is down -1.8%, France’s CAC40 is down -1.6%, and Pan European blue chip index, EuroStxx50 is down -1.6%. Euro is down -0.4%, while Pound is down -0.7%.

Yen recovered earlier loss and now up 0.6% against Dollar.

These blasts and related uncertainties are not likely to be seen as in favor of Britain staying in European Union. Higher the terror risks in Europe, greater is the possibility that Britons will further distance themselves with EU. Hence the selloffs in Pound.