Just when British Prime Minister Theresa May thought things couldn’t get worse…
For the week ahead, it was all about the British PM rallying the troops to get behind the Brexit deal that was voted out last week.
Speaker of the House, John Bercow blocked a 3rd meaningful vote this week. A lack of material difference to the motion from last week was the reason behind the decision.
The lack of a vote and the 29th March departure from the EU does now raise the likeliness of Britain’s involvement in May’s European Parliament election. With Britain having voted to leave the EU back in the summer of 2016, the involvement reflects the government’s inabilities to deliver.
There had been hopes of a meaningful vote taking place before the EU Summit on Thursday. The latest drawback now gives the EU the right to demand a lengthier extension that could go beyond 12-months.
Assuming that all 27 EU member states vote in favour of an extension, it may well be back to the Brexit drawing board. Theresa May and the Tories have failed ‘til now and nothing suggests that another 12-months would deliver success.
If Brexit looks chaotic today, it could be pandemonium come 29th March…
It came with little surprise that the Pound was under pressure through Monday and the early hours of this morning.
An interesting consideration is that all 27 member states will need to vote in favor of any extension. For populist parties looking to topple the Establishment, now would be the ideal time to wreak havoc. It only takes one populist government to vote against an extension to bring the financial markets to its knees.
Expect plenty of political wrangling in the days ahead. Theresa May needs to push the deal through ahead of Thursday’s EU Summit. Changes to parliamentary law could be one avenue. It remains to be seen, however, how feasible such a move is when considering the time constraints.
The Pound stood at $1.3256 at the time of writing, having recovered from an intraday low $1.31839 on Monday. Parliament can vote to block a no-deal departure from the EU, but it ultimately boils down to the EU. No extension and that is a no-deal departure…
This article was originally posted on FX Empire
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