The noes have it
Last night, the Prime Minister May’s Brexit deal was rejected in Parliament by 391 votes to 242. The defeat was widely expected therefore the pound did not fluctuate much once the results were announced. Tonight, PMs will vote on a no-deal Brexit which is likely to be rejected, and if that is the case, a Brexit delay vote will take place on Thursday. The future of Brexit remains uncertain with a no deal Brexit, softer Brexit, general elections or even a second referendum still potential outcomes. Philip Hammond, Chancellor of the Exchequer is delivering his Spring statement to the House of Commons this afternoon, which should reveal the state of UK’s economy. It however doesn’t outline major tax changes so should have a minimal impact on the pound.
In the EU, ambassadors of the 27 countries gathered in Brussels this morning to discuss the bloc’s options following PM May’s defeat. The EU has already made it clear that they are not in favour of Britain crashing out of the EU without a deal but they have also reiterated that they cannot give the UK any more concessions. It’s highly likely that MPs will vote for an extension (delayed Brexit) and it will be up to the EU to decide whether this is an option at all.
Following mixed US data, the greenback remains stable, still trading below 1.13 against the EUR. According to the US Census Bureau, Durable Goods Orders increased by 0.4 per cent in January, while analysts expected a 0.5 per cent decline, and December reading was upwardly revised to 1.3 per cent. Meanwhile, the Producer Price Index was up by 0.1 per cent in February, missing the market’s expectations of 0.2 per cent.
The main market mover however remains Brexit and any development that would help understand what might happen on March 29th.
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