GBP under Brexit pressure
|Brexit deadlock remains. Will Prime Minister Theresa May maintain political support and win concessions from the EU? We’ll see at the next vote, scheduled for 27 February. We expect GBP/USD to decline further as Brexit fatigue weighs on traders. Currently trading at 1.2834, GBP/USD is heading along 1.2810 short-term.
Following fruitless negotiations with EU President of the Commission Juncker and EU President Tusk in Brussels, May faces resentment from lawmakers, who are concerned about the upcoming decision: either back May’s deal, vote for a “long” extension of Article 50 and try to get a better deal, or reverse the exit decision (i.e. second referendum, unilateral withdrawal of Article 50). Today’s government motion will ignore a no-deal scenario, a move that could threaten May’s leadership in the Conservative party. Once again, she risks. a no-confidence. Still, today’s Parliament session will not be a game changer – that will likely come in two weeks.
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