|

Parliament approves Brexit, hedges on departure date

Boris Johnson’s victory in winning House of Commons approval for his Brexit deal means that Britain’s departure from the EU has moved from if to when.

But his attempt to push through the enabling measure to meet the October 31st exit date was defeated as members wanted more time to examine the legislation.  The rejection of the “timetable motion” makes is unlikely the government will be able to meet the month end departure deadline. 

Mr. Johnson said he would “pause the legislation” in order to receive the EU response to the parliament mandated delay. “One way or another, we will leave the EU with this deal,” he asserted.  Mr. Johnson also promised that the government will speed-up its preparations for a no-deal exit.  

The government will now work with the EU Council and the member states to determine the length of the extension which has already been requested by the Johnson government as required by the Benn Act.  With Brexit approved the delay will likely be a short one designed to permit the passage of the enabling bill.

The convincing margin of 329-299 backing his deal on its second reading saw 19 Labour members from Leave areas join Eurosceptic Tories, independents and regular Tory members in providing a much larger than predicted majority. Prior to the vote most observers had projected a winning margin of 1 to 5 votes.  

Sterling fell sharply from its post-approval high of 1.3001 to 1.2860 as the “programme motion” failed before stabilizing around 1.2890.  Monday’s cable top of 1.3013 had been the highest in five months.

Author

Joseph Trevisani

Joseph Trevisani began his thirty-year career in the financial markets at Credit Suisse in New York and Singapore where he worked for 12 years as an interbank currency trader and trading desk manager.

More from Joseph Trevisani
Share:

Editor's Picks

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans. 

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.