Home Daily Commentaries Johnson loses first vote on Brexit

Johnson loses first vote on Brexit

Daily Currency Update

GBP - British PoundLate last night Boris Johnson lost his first vote in the House of Commons as rebel Tory MPs and the opposition took control of the timetable of the house. 21 Tory MPs rebelled against the government and all of these MPs have now been expelled from the party which completely wipes out the Prime Minister's working majority which had already dropped to 0 earlier in the day. The next move from the opposition will be a vote today on a snap general election which will probably be blocked before a vote takes place on forcing the government to ask for an extension, should Parliament not support the Withdrawal Bill. The pound actually welcomed the news and picked up against the US Dollar and Euro but still remains crippled by Brexit. The base case scenario for many is still a general election before the October 31st deadline which is sure to be a de facto referendum on the EU with the (purged) Tory party campaigning for a do or die approach whilst the opposition parties campaign for something along the lines of a 2nd referendum.

Key Movers

US manufacturing numbers caused alarm bells for investors on Wall Street yesterday as it fell to its lowest level in 3 years. Manufacturing is crucial to the US economy and this move spells bad news for the wider economy with the chances of a 50bp cut from the Federal Reserve increasing. The Fed go into their blackout period this week ahead of their meeting on the 18th but before that John Williams is set to speak.Christine Lagarde, the incoming ECB President, is in front of the European Parliament later today which will be very interesting to the market to see whether she indicates if she will continue with Mario Draghi's policies.

Expected Ranges

  • GBP/USD: 1.2010 - 1.2230 ▲
  • GBP/EUR: 1.0960 - 1.1120 ▲
  • GBP/AUD: 1.7890 - 1.8180 ▲
  • GBP/NZD: 1.9080 - 1.9180 ▲