Monex: Toegenomen Brexit-onzekerheid drukt op Britse pond
Monex: Toegenomen Brexit-onzekerheid drukt op Britse pond
Hieronder volgt een commentaar in het Engels van Ranko Berich, Head of Research bij Monex Europe op de koersbeweging van het Britse pond dat lager noteert doordat de hoop op een Brexit-doorbraak lijkt te vervliegen.
Sterling starts the week marginally lower after Johnson’s deal suffers another blow. On Saturday, MPs sat in parliament on a weekend for the first time since the Falklands war, and voted for the Letwin amendment. The amendment, which passed by 322 votes to 306, forces Johnson to request an extension from the EU via the Benn Act as Parliament will now withhold approval of the PM’s deal until the withdrawal bill implementing Brexit has been passed. The timeline looks murky this week given the weekend’s developments.
Saturday’s Letwin amendment could be bypassed today should House Speaker John Bercow allow another attempt by the Government at passing a meaningful vote. If such an attempt were to succeed un-amended and was passed by Parliament, Johnson would no longer have to abide by the extension request and the government will table legal ratification of the proposed deal. However, should amendments alter the proposed deal at this point, by bypassing the extension request the UK could still slip out of the EU on October 31st without a deal.
Many believe House speaker John Bercow will block a meaningful vote by Johnson today given the motion was already debated over the weekend. Bercow is subject to make a statement at around 16:30 CET today, but the parliamentary timetable is always subject to change. Even if Bercow allows the meaningful vote to occur, another amendment similar to Letwin’s over the weekend could also be passed seeking an extension regardless. If Bercow denies the Prime Minister’s request, Johnson could table a meaningful vote on Wednesday under the provision that an article 50 extension holds in the event of his withdrawal agreement failing to secure the required votes.
The sequence of events is convoluted to say the least. This is reflected in GBP USD this morning, which sits marginally lower, as markets still have no gauge to how parliament will likely vote when Johnson’s withdrawal agreement eventually gets put to the floor. The extension request via the Letwin amendment adds a layer of support by marginally reducing the probability of a no-deal exit, but the extension is yet to be granted by the EU. The path to the exit can still take many routes and sterling will likely trade sideways until parliament shows their support for which path to take.