At the heart of Brexit volatility lies complacency

THERE appears to be a profound sense of shock mixed with bewilderment at the outcome of the UK referendum on whether to leave the European Union (EU), popularly known as the "Brexit". It is difficult to understand why this should be - the campaigns to either stay or exit the EU had been exhaustively conducted over several months, the UK Treasury and many other experts had repeatedly warned of the likely consequences if the "leave" camp prevailed (among them a surge in unemployment and inflation in tandem with a plunge in the pound and property prices) and all surveys suggested the vote outcome would be very close.

This column too had on April 22 ("2016 Equities: Watch the E's and R's") warned about the unknown factor known as Brexit. "If a Republican victory in the US presidential election represents a complete unknown for financial markets, so would an 'exit EU' vote in the UK in the June referendum," it said, adding that "a 'leave' majority on June 23 this year could provoke a large upswing in v…