100 days until Brexit
19 December, 2018
Today marks 100 days until the Brexit deadline of 29th March 2019, and despite the best efforts of the government, we are still no clearer to knowing how that Brexit will be enacted. All options remain possible:
- Theresa May’s deal, including its much-maligned Backstop
- No Deal Brexit – managed or cliff edge
- General Election
- People’s vote second referendum
- Withdrawal/extension of Article 50
Over the course of the past few weeks, since Theresa May came back from Brussels with her deal agreed, we have seen an almost daily farcical Brexit event. Be it the resignation of the man who was in charge of negotiating the deal, because he didn’t like his own deal, or a no-confidence vote in the PM from her own MPs, crushed by the following vote because the ERG who brought the motion is a small percentage of the Conservative Party, and so didn’t ever have the numbers to win it. Yesterday was no different, with news breaking overnight that Labour had tabled a motion of no confidence in the PM. Big news. Had Jeremy Corbyn finally taken a stand? No. He had tabled a motion so irrelevant that the government ignored it, didn’t allow it to be debated in the house, and so it drifted into ignominy. And today we learn that some of the minor opposition parties, led by the SNP, have tabled a vote of no confidence in the government, but since only the leader of the main opposition can table a binding vote of no confidence, this will likewise almost certainly be ignored.
The reality is until Theresa May brings her deal before the house in the third week in January, and a vote is finally taken, we will not know any more answers. If the vote goes against her, then Jeremy Corbyn will then likely finally have the resolve and numbers to take the genuinely forceful step of an official vote of no confidence in the government, and the path will become clearer. If she wins the vote, then likewise we will have more certainty because her deal will be the Brexit result for the UK.
For those of you with a currency requirement, what this means is pretty much no chance of any uplift for Sterling in the short term. The Pound will struggle to find any support while uncertainty remains, and with the thin trading generally experience over the festive period we are much more likely to see further drops with Sterling under pressure against its more favoured major currency competitors.
If you have an upcoming requirement, you should consider whether locking the rate in now using a forward contract may be the best option for you. Why risk your currency becoming more expensive when you can remove the volatility and sit back and relax over the festive period? Speak to your CI account manager today to discuss your options.
- Sterling had a couple of brief rallies towards the end of last week 22 July, 2019
- Sterling hits lows of 2019 19 July, 2019
- ‘Backstop is dead’ and Sterling is lowest performing currency 17 July, 2019
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