Rumours have surfaced that PM Theresa May is likely to cancel the vote on Tuesday in order to avoid a massive defeat which could lead to further repercussions such as a vote of no confidence.
Theresa May will be giving an official statement at 3.30pm today. If confirmed, this news will essentially represent that parliament doesn’t support the current deal proposed by the government and that May has been unable to win over the support of MP’s at the House of Commons.
So what will be the options moving forward? Well, we could simply see the vote delayed or alternatively, the government will have to go back to the drawing board completely scrapping the deal. The President of the European Commission Jean-Claude Juncker has already pointed out that the EU is not willing to renegotiate the deal which leaves the UK in a bit of an awkward position moving forward. At present it looks like it’s either this deal or no deal and as Parliament continues to beat down Theresa May’s deal the latter appears more likely.
Either way, this news just adds to the ongoing uncertainty which we know that the markets absolutely loathe. After finding strength earlier today Sterling has now plummeted to 18month lows with GBPUSD down 0.5% on the day. This leaves GBP/USD trading below the all important 1.2700 level mentioned in today’s analysis and could lead the pair to roll over to 1.2500 support and potentially lower.