Investing.com - Sterling fell to fresh two-month lows against the dollar on Tuesday after an opinion poll by the TNS polling company pointed to a “significant lead” for the Leave campaign ahead of the U.K. European Union membership referendum.
GBP/USD was down 1.03% at 1.4103, the weakest level since April 14.
The TNS poll showed that the Leave campaign held 47% of the vote, compared with 40% for Remain. Undecided voters totaled 13%, TNS said.
The poll came after a number of recent polls showing that the EU referendum race is tightening ahead of the June 23 referendum.
Market sentiment has been hit by fears over the prospect of a British exit from the EU, or Brexit, sending investors scrambling to buy safe haven assets.
Investors fear that a Brexit could trigger a period of uncertainty in financial markets and tip the EU into a recession.
Data from betting odds supplied by Betfair on Tuesday indicated that the implied probability of a Remain vote fell to 62%, down from 78% last week.
Sterling was trading near three-year lows against the yen, with GBP/JPY down 1.12% at 149.74.
The euro also set fresh three year lows against the yen, with EUR/JPY hitting a trough of 118.52.
Japan’s Finance Minister Taro Aso on Tuesday reiterated a warning against fresh strength in the yen, saying officials would "firmly respond” to prevent speculative moves in the foreign exchange market from persisting.
Aso also said he would closely watch the Brexit referendum next week, given its potential to disrupt global financial markets.
Meanwhile, Reuters reported that the European Central Bank would pledge to backstop financial markets in conjunction with the Bank of England in the event of a vote to exit the EU.
Providing extra liquidity would reduce pressure on banks and help calm financial markets after the vote.
The yen pulled back from six-week highs against the dollar, with USD/JPY last down 0.23% at 106.00.
The dollar found some support after data showing that U.S. retail sales rose more than expected in May, boosting the outlook for second quarter growth.
U.S. retail sales rose 0.5% last month, the Commerce Department said, after surging 1.3% in April. Economists had forecast a more modest 0.3% increase.
The euro was sharply lower against the dollar, with EUR/USD down 0.89% at 1.1191.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.68% at 95.06.