Brexit vote comment

David Cheetham XTB UK

As had been widely predicted, the House of Commons has resoundingly rejected PM May’s Brexit deal and sent the pound tumbling down to its lowest level of the day. The results show the margin of defeat to be at the higher end of estimates, with the 202 votes in favour well short of the 320 majority needed. Leader of the opposition, Jeremy Corbyn, has already stated that he will table a vote of no confidence in the government tomorrow.

Sell the rumour buy the fact?

However, after the initial knee-jerk reaction lower we’ve seen some buying in the pound which has bounced strongly off the lows. Comments from PM May that she is not seeking to run the clock down and looking to leave the EU in an “orderly fashion” could be behind this. Traders are seemingly taking the outcome as paving the way for an extension of the Article 50 deadline, rather than increasing the chances of a no-deal Brexit and this has caused the recovery seen in the pound.

Attention now turns to what happens next with the levels of uncertainty raised once more and moving up to unprecedented heights.

Author

David Cheetham

XTB UK

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