Irish backstop impasse affects the Pound
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Sterling jumped and fell on the latest Irish backstop news
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Prime Minister to face a cabinet rebellion in case of no-deal Brexit?
Sterling jumped and fell on the latest Irish backstop news
Sterling saw its fair share of ups and downs on Wednesday, getting a boost from talk of developments with the Irish backstop discussions, then falling back down as these did not come to fruition. GBP bounced up over 0.5% against the USD on news reports that the EU was prepared to compromise on elements of the Irish backstop issue, dropping when Northern Ireland’s Democratic Unionist Party came back in opposition to the suggestion and again when it became clear that the EU denied the rumours.
Prime Minister to face a cabinet rebellion in case of no deal Brexit?
The Pound was also under pressure as news broke that UK Prime Minister Boris Johnson could have a cabinet rebellion on his hands in the event of a no deal Brexit. There were also reports that he had assured policymakers that a promise to take steps against no deal would feature in the party manifesto. There were subsequent reports in the media that the EU could make an offer of a Brexit deadline extension to 2020, but this all depends on whether there will be a second EU Referendum or a General Election in the UK. We watch and wait for more news and the markets are doing the same…
Today’s data
Looking ahead, we await German trade balance data and French industrial output, but the main focus will be on August’s UK Gross Domestic Product (GDP) and industrial and manufacturing production data, as well as European Central Bank (ECB) minutes. Later in the day, the US Consumer Price Index (CPI) will take centre stage.
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