In another blow for beleaguered PM Theresa May, the House of Commons voted 329 vs. 302 to take back control of Brexit and hold a new round of votes on a series of options which may radically alter the shape of Brexit.
Yesterday came as no shock to the millions of Brexit watchers across the world, once again, May’s authority has diminished (well, what’s left of it anyway?!). It’s now clear, Parliament desires control over the direction and future form of Brexit, which could put a number of new options on the table. These could well include and not be limited to: closer-styled EU relationship options (e.g. Norway), no-deal, cancelling Brexit, a 2nd referendum or even a general election.
The votes are set to take place on Wednesday and are non-binding. The government has already made it apparent they cannot guarantee to honour any potential outcome as a) they don’t yet know what it is and b) they don’t know whether it would be negotiable from an EU perspective. The pound is still in limbo, stuck in tight ranges against its major peers (GBPEUR: €1.15 – €1.17 and GBPUSD $1.30 – $1.33). Last night’s developments had little impact on sterling but no doubt the votes which lie ahead could well do so. PM May is expected to hold her meaningful vote pt.III at some point this week. Her cause was boosted by confirmation yesterday that influential Tory MP, Jacob Rees-Mogg would be happy to back her deal if the DUP were on-board. The plot thickens…
Today’s trading session is light on economic numbers. The main focus for currency markets will remain on Brexit as well as ongoing US/China trade talks. One event of note comes this evening as the Reserve Bank of New Zealand hold a policy decision with the central bank expected to maintain interest rates at 1.75%.
Written by Viv Savani. 8:55am, March 26th 2019
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