Towards the end of yesterday afternoon, Theresa May confirmed that the Brexit deal vote will take place in the week beginning 14 January 2019. The UK Prime Minister delivered a statement to the Commons and said that she is fully aware that MPs are concerned about the Irish backstop, but that further clarification is possible. She also said she was looking at ways to empower the Commons to have a say over the implementation of the backstop. The debate on the Brexit deal will commence in the week beginning 7 January 2019, with the vote taking place the following week.
May’s announcement came in the wake of a threat by Labour’s Jeremy Corbyn, who had earlier said he would table a motion of no confidence in the Prime Minister – not the government – if she did not set a date for the Brexit vote. The opposition party is concerned that May is running down the clock so that MPs have to choose between her deal and no deal. Of course, May will deny that it was in response to Corbyn’s threat, but he did say that she had led the UK into a ‘national crisis’.
We also learned that planning for a no-deal Brexit is set to be ramped up this week, with reports suggesting an additional £2 billion could be allocated to government departments. The Prime Minister’s official spokesman said that there were no plans to stage indicative votes on a range of Brexit options, including a second referendum, if May’s deal fails. So, from this, it appears that May really is offering MPs the choice of supporting her deal or rejecting it in favour of a no deal.
The pound made some slight gains against the dollar but the moves were fairly muted in truth. The euro had the best start to the week, although more substantial moves can be expected as the week progresses. There is still time to put in place a forward contract to protect your budget against currency volatility. We expect some big sterling moves in the New Year, though in which direction is almost entirely dependent on what happens following the Brexit deal vote. We encourage you to talk through your options with your Personal Trader on 020 7898 0541 before it is too late.