Less than 72 hours have passed since a bleary-eyed David Cameron emerged from negotiations in Brussels with his new deal for the UK to stay in the EU. The first Cabinet meeting on a Saturday since the Falkland’s war was called for the next day, followed immediately by the announcement that the referendum will take place on 23rd June. 7 of the Prime Minister’s 25 Cabinet ministers have since broken ranks and are audibly supporting the ‘out’ campaign. The last such minister, and the most significant as far as the media is concerned, is the Mayor of London, Boris Johnson, who finally nailed his colours to the mast yesterday afternoon. The battle over a possible ‘Brexit’ has started at quite a pace and we can expect it to continue until we go to the ballot box in 121 days time.

Both sides are claiming early victories in the battle rather than the war. The ‘in’ campaign was bolstered by David Cameron’s renegotiated deal, which ensured improved financial freedom for the City. As Chris Cummings, Chief Executive of The City UK, a trade body, said, the agreement struck late on Friday generated “a collective sigh of relief”. Business leaders are now being cajoled into getting behind the Prime Minister with a first letter already having been sent to the Chief Executives of FTSE100 companies. Unexpectedly, the Business Secretary, Sajid David, has decided to put his weight behind the ‘in’ campaign reportedly concerned over the short term risk to the UK economy that a Brexit could cause.

On the other side of the divide opinions are united in the belief that David Cameron’s renegotiations do not go far enough. For many of the most vocal campaigners, Nigel Farage being a key example, such a view pre-dates the Prime Minister’s new deal and, therefore, does not come as much of a shock. The initial defection of 6 members of the Cabinet was quite a coup though; especially as one of David Cameron’s closest friends, the Justice Secretary Michael Gove, was amongst their number. Boris Johnson’s decision to follow suit will now give the ‘out’ campaign a popular figurehead who is guaranteed to dominate headlines.

In his newspaper column this morning, Boris Johnson wrote:

“We will hear a lot in the coming weeks about the risks of this [leaving the EU] option; the risk to the economy, the risk to the City of London, and so on; and though those risks cannot be entirely dismissed, I think they are likely to be exaggerated. We have heard this kind of thing before, about the decision to opt out of the Euro, and the very opposite turned out to be the case”.

Flying in the face of these remarks the Pound suffered its biggest drop (1.5%) against the Dollar in almost a year in the immediate aftermath of Mr Johnson’s decision. At the same time the Pound fell 1.2% against the Euro. JP Morgan warned that a vote for Brexit would push the Pound lower. “We penciled in a move of about 10% in trade-weighted terms,” it said. Oxford Economics believe that the Pound can regain these losses by the end of the year but only if voters opt to stay in the EU.