(Kitco News) - Although recent media reports show that Greece is close to coming to a funding agreement with its European creditors, the future of the eurozone and the European Union remain in doubt.

 

Economists and analysts are starting to focus their attention on the U.K. elections to be held May 7, which could have an impact on the country’s membership into the European Union.

 

During the election campaign, the Conservatives, led by current Prime Minister David Cameron, have vowed to uphold their promise of holding a referendum in 2017, asking voters to decide whether or not the country should be part of the E.U. 

 

The latest Ashcroft National poll showed a relative dead heat with the Conservatives leading at 36%, the Labour at 30%, UKip at 11%, Liberal Democrats at 9%, and the Green Party at 7%.

 

In a report published Monday, German-based private foundation, Bertelsmann Stiftung, said that a “Brexit” would have dire consequence for the U.K.’s domestic economy and for the E.U. as a whole.

 

The foundation said that an exit from the E.U. could cause the U.K. economy to lose more than €300 billion as its gross domestic product (GDP) falls by as much as 0.6% by 2030. At the same time, other E.U. members, like Germany, would only see “minor economic losses” as the regional economy could lose up to €115 billion as its GDP contracts by up to 0.3%.

 

“But the bottom line is that everyone involved would lose economically and politically from the U.K. leaving the E.U. (Brexit),” the report said.

 

"A Brexit is a losing game for everyone in Europe from an economic perspective alone - particularly for the U.K. But aside from the economic consequences, it would be an especially bitter setback for European integration as well as Europe's role in the world. Setting the course for a Brexit in the House of Commons elections would weaken the Union,” Aart De Geus, Chairman and CEO of the Bertelsmann Stiftung, added in a press release.

 

Commodity analysts have been bullish on gold demand in Europe as the region’s future remains uncertain. After a brief correction gold priced in euros bounced back to above €1,100 an ounce.

 

Courtesy: Kitco News