29/01/2019 - Crunch Time For May

GBP

Theresa May faces a series of votes on Tuesday that could change the direction of Brexit. May's Brexit deal will be voted on in Parliament, a deal which has been slightly changed but the overriding feeling is that it still will not pass through Parliament due to the Irish backstop issue. If May’s deal is rejected again, Parliament could take control of the situation and May will no longer be able to move forward with delivering Brexit.

A number of amendments have been tabled by backbenchers to the Prime Minister. At the moment, it is not clear which amendments will be put forward to vote on by the speaker but the amendments that could be put forward are:

  1. Scrapping the backstop
  2. Giving Parliament control
  3. Rule out no-deal Brexit
  4. Article 50 extension
  5. Labour’s custom union
  6. Second referendum.

Yvette Cooper and Nick Boles are trying to force May to delay Brexit so the U.K. does not crash out of the EU without a deal. They’re asking for Parliament to vote to change its own rules so that for one day it can debate a bill in which would require May to seek an extension from the EU of Article 50. The impact of delaying Brexit will cause the likelihood of a no deal to diminish and it could increase business confidence and cause the pound to rally.

The problem Yvette Cooper faces is the backing of the Labour Party who are not keen on extending Article 50. The Labour Party believe that extending article 50 shows failure to respect the referendum result. Furthermore the Labour Party has tabled it’s own amendment calling for MPs to vote on options including a second referendum and the party’s own Brexit policy.

Lastly May is favouring the amendment proposed by Andrew Murrison and Graeme Brady which is replacing the backstop with ‘alternative arrangements’. The prime minister said the amendment is the only way the EU will change its position.

Key Announcements

10:00 - USD: Consumer Confidence - forecast 125 from previous 128.1
19:00 - GBP: Brexit Parliamentary vote