LONDON: Sterling rallied on Monday after opinion polls swung in favour of the campaign for Britain to stay in the European Union, boosting risk sentiment and sending the safe-haven yen tumbling.
The implied probability of a "Remain" vote in Thursday's referendum rose to 72 percent after falling as low as 60 percent last Thursday, according to odds from gambling website Betfair.
Sterling rose 1.7 percent to $1.4604. It earlier reached $1.4625, its highest in three weeks, as it extended a recovery from Thursday's more than two-month trough of $1.4013.
The pound jumped 2 percent to 152.51 yen, pulling away from a three-year trough around 145.34 also set on Thursday. The euro fell 1 percent to 77.75 pence.
Investors reacted after three of six opinion polls published over the weekend showed a shift towards keeping Britain in the EU, with some citing the killing last week of pro-EU lawmaker Jo Cox as a factor.
"The outcome of the referendum is wide open again," said Ulrich Leuchtmann, currency strategist at Commerzbank. "But at least "Leave" no longer seems the most likely scenario. Should the next polls suggest that the change of sentiment persists euro/sterling may ease further."
Prior to the latest polls, data from the Commodity Futures Trading Commission released on Friday showed speculators reduced their net short positions against sterling in the latest week, from a three-year high. The pound still declined by around 3 percent against the dollar during June 7-14.
Indicating a general pick-up in risk appetite as Brexit worries eased, European shares opened higher and U.S. stock futures rose.
The yen dipped across the board, offering some relief for Japanese policymakers concerned about the currency's strength.
Some analysts said the moves could easily reverse.
"I don't think these moves are sustainable because nobody can forecast what will happen," said Masashi Murata, senior currency strategist at Brown Brothers Harriman in Tokyo, referring to the Brexit vote.
The dollar climbed 0.5 percent to 104.66 yen, moving away from Thursday's nearly two-year low of 103.55 hit after the Bank of Japan held policy steady and disappointed investors hoping for more stimulus. The euro jumped 1.3 percent to 118.87 yen, well above Thursday's three-year low of 115.51.
Against the dollar, the euro gained 0.7 percent to $1.1353 , helping to push the dollar index down 0.6 percent to 93.589.
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