GBP/USD: Brexit voting sends cable back on its knees below 1.29 handle (Program Motion lost)
|- GBP/USD has popped and dropped following the UK lawmakers voting on the second reading of the WAB.
- GBP under pressure here as Brexit uncertainty prevails.
It has been a big day for UK politics and Brexit. The Speaker of the House of Commons yesterday refused the government’s request to table another meaningful vote of its Withdrawal Act on the basis that there was no change in either substance or circumstance from when MPs has last debated it – on Saturday.
Instead, the government has set out a schedule to force through its Withdrawal Agreement Bill, (WAB), in a last-ditch attempt to get Brexit done on the 31st October. Today was the first day of passing the bill through the stages in the lower house, intended to be put before the House of Lords over the weekend - Lawmakers were voting on the second reading of the legislation of the WAB.
According to the FT’s analysis, the government could have won the vote on its bill by 320 votes to 315.
The results came in as follows:
- UK Government wins 2nd reading of Brexit deal legislation; 329-299 vote. (Had the government, not one, Johnson hinted that he could have called a snap election - GBP fluctuated in a 20-pip round turn on the vote).
However, it was the 'Time-Table-Vote' that mattered the most. It was always going to be a possibility that the opposition would attempt to attach amendments to the bill in an attempt to ensure that the UK stays within the EU’s customs union - not least to try for a second ‘confirmatory’ referendum – (If MPs had required more time to review the bill, considering it was only released yesterday, well over 100 pages, then an extension by the EU would be required beyond the October 31 deadline for Brexit) – The DUP were said to be voting against the motion.
Time table results came in as follows:
- 322 lawmakers voted against to 308 - That's a loss for Johnson and the government.
GBP is under pressure, back below the 1.29 handle, while the uncertainty prevails over Brexit, and the timeline – This makes it very difficult for Johnson to leave the EU by 31 October.
GBP/USD levels
- As the Brexit gets delayed, GBP/USD is retracing down below the 1.2900 handle.
- The level to beat for bears is the 1.2881 support.
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