In fact, it is probably fair to say that it has moved up several gears. David Cameron got his deal with the rest of the union’s leaders, and while some will decry it for being insufficiently robust, it is enough for him to go to the country with a recommendation to vote to remain in the EU.
Boris Johnson’s decision to back the Leave campaign, joining cabinet heavyweights Michael Gove and Chris Grayling, rather spoiled the PM’s weekend. The backing of such a major figure, perhaps rivalling only Nigel Farage in his visibility among the British populace, is a significant coup for the ‘Outers’, and has made the chances of a ‘leave’ vote a little better today.
So far the market reaction has been concentrated in the FX sphere, with sterling dropping against a number of other currencies, including the US dollar and the Japanese yen. There are also indications that the gilt market is also going to come under pressure. For now bond investors are still happy to buy UK government paper, with little sign of an increased risk premium being demanded, but that could change as the vote approaches.
Stock markets have been broadly unaffected, being more concerned with continuing volatility in oil and whether the rally of mid-February can be sustained. However, as the date for the plebiscite nears we will likely see a number of firms with heavy European exposure, such as banks and some insurers, come under pressure.
The classic trade would be to expect FTSE 100 strength (given its extra-UK focus) versus FTSE 250 weakness, but as with the Scottish referendum and the General Election, it is still too soon to tell what the real stock market impact will be.