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Mixed signals from financial markets

It was undoubtedly a surprise when 52% of the British electorate voted to leave the European Union. The immediate reaction of international investors was flight into safe haven assets – US and German government bonds – and a sell-off in equities and property. Investor reaction reflected a view that the British electorate favoured a path of change and this change is associated with uncertainty, which will undoubtedly drive volatile market behavior.

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