Boris Johnson is set to face two crucial votes this evening, one on his Withdrawal Agreement Bill and another on the parliamentary timetable for approving legislation. With a debate on the Prime Minister’s deal already underway, Mr Johnson has said the bill will “allow the UK to leave the EU on 31 October” but warned that the government has also “accelerated” preparations for a no deal.
The comments left GBP investors in a state of limbo as uncertainty prevails ahead of next week’s watermark deadline.
Boris Johnson’s official spokesman also noted that “voting down a programme motion has serious implications” and added: “It means legislation can drift on and on and that is not in the interests of the UK or the European Union which has made clear itself that it wishes to move on.”
The government warned that if tonight’s vote is unsuccessful, the Brexit bill will be abandoned and they will push for a general election, a move which would weigh on the pound.
Politicians are set to vote at 7pm, and a defeat in either vote will damage the Prime Minister’s plans to leave the European Union by October 31.
However, a vote in favour of the deal will see Sterling rise against the single currency and provide GBP traders with their first glimpse of clarity since the 2016 referendum.
Meanwhile, European Council President Donald Tusk said he was discussing Britain’s request for a Brexit deadline with the leaders of the EU27.
He noted that they would make a decision “in the coming days” and, speaking to the European Parliament in Strasbourg, said “a no-deal Brexit will never be our decision”.
The upswing in Brexit optimism and reduced odds that the UK will leave the EU next week offered a foothold of support for the single currency.
Looking ahead to the end of the week, the euro may come under pressure ahead of Mario Draghi’s last meeting as President of the European Central Bank.
While the meeting is unlikely to see any major announcements after policymakers unleashed a wave of stimulus in September, divisions within the bank could still weigh on the euro.