Big Brexit Wednesday as a Draft Deal is agreed with Brussels
15 November, 2018
Will there really be a deal this week?
No, but there could be next week when the EU leaders meet for a summit which is set to happen on Sunday 25th November. May has told her ministers, some of whom are very sceptical about her version of Brexit that while the agreement may not be perfect, it’s as good as the government can get.
May chaired an emergency cabinet meeting yesterday to seek her senior ministers backing for the draft agreement, what many are calling a “botch deal” and had announced last night she has got her top team to sign it off, she now faces the fight of her life to get MP’s to vote for it. If the only choice presented to MP’s is May’s version of Brexit or no-deal it could frighten enough waverers into backing May.
What happens next?
Now the cabinet has signed it off, the EU Commission is expected later to publish the details of the 585-page draft withdrawal agreement as well as the much shorter declaration on future economic and security relations. Ambassadors from the remaining 27 EU member states will meet to discuss signing it off.
If this happens, the government will then face a battle to win Parliament’s backing, in a vote the BBC’s Laura Kuenssberg said could take place around 7 December.
What does all this mean for the Pound?
The pound has found support on the basis that a Brexit deal has been reached. It peaked at a 6 month high on Tuesday before dropping off slightly yesterday with news of a rebellion against the deal. It can’t see a sustained bid on the assumption that there is a tremendous amount of scepticism surrounding what May is seeking Parliament to agree.
If we don’t agree to a deal we enter unchartered territory with possibly another referendum or a general election and the inevitable fall of the Pound.
Is there any other news?
Not really, no, Brexit is dominating the news. GBP/USD is understandably very volatile as PM scrambles towards the Brexit finish line at the eleventh hour, yesterday closing at 1.2970, down from a high of 1.3037 and up from a low of 1.2885.
Not much out in terms of data today, with only retail sales data due out at 9.30am, and the Brexit deal being the main driving force behind any movements in the market, with the Telegraph citing possible resignations from 2 Ministers.