Summary:
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Brexit deadline to be extended to Jan 31st 2020
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MPs to vote later on PMs election request
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GBPUSD remains well supported
Despite some lingering concerns that they wouldn’t, the EU27 have done what most observers had expected in agreeing to a Brexit flextension until January 2020. Donald Tusk has tweeted confirmation in recent minutes, also stating that it is expected to be formalised through a written procedure later on. Speculation that the bloc would only entertain a shorter extension at the request of France had caused some doubts but it appears that once more the EU are trying hard to be seen to not force the issue.
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Open account Try demo Download mobile app Download mobile appAn election before year-end seems the most likely outcome, although there appears to be a greater chance of this occurring December 9th, rather than the government’s preferred date of December 12th. MPs will vote later on the PMs proposal but with Labour set to abstain and a two-thirds majority needed it is unlikely to pass. The Lib Dems and SNP are said to favour a slightly earlier date, and have proposed a bill that would only require a simple majority of over 50% to pass.
Looking at the dates it seems to be splitting hairs with the decision to try and bring it forward to Monday 9th December from Thursday 12th hardly likely to see any tangible impact from the student vote who would be heading home for Christmas given that it is the same week. The pound has started the new week little changed with the markets a little bit less sensitive to Brexit headlines than there were earlier this month. The FTSE is trading lower by around 20 points with HSBC the main laggard after shares in the bank fell over 4% following a disappointing earnings update, with pre-tax profit dropping 18% to £3.8B in Q3, worse than the consensus view amongst analysts.
GBPUSD remains well supported despite pulling back a little last week. The momentum seems to still be with longs as long as price remains above the 1.2745 level with the region around 1.3010 an area to look to above. Source: xStation
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