Brexit Update – Another Extension and Promise of a Voter Resolution?

With the EU continuing to dismiss Brexit proposals, it may well end up in the hands of the British voter to decide the fate once more.
Bob Mason
Brexit - Flag of European Union

The Latest

Time is rapidly running out for British Prime Minister Boris Johnson to deliver a Brexit deal that would appease, not only the EU but also the pro-Remainers and the DUP.

As things stand, there’s no deal likely to be reached by the end of the week. News of France giving the EU until the end of the week to deliver an alternative solution to the Irish backstop merely delivered more false hope than an actual belief of a deal being reached.

French President Macron’s offer of more time may ultimately be nothing more than a smokescreen.

The British government has continued to deflect blame over the Brexit calamity to the EU. An offer of more time is certainly a softer stance than even a week ago.

When considering the time it took to deliver the last proposal, which was largely dismissed by Brussels, an 11th October deadline looks set to scupper the PM’s ambition of solving the Brexit puzzle.

The Pound

At the time of writing, the Pound was up by 0.04% to $1.2296.

A lack of progress on Brexit continues to pin back the Pound. One area of support, however, is the expectation of an extension.

There is an element of disbelief that the British PM will be able to ignore the Benn Act.

Assuming that the British PM does make a request for an extension, however, there are likely to be more fireworks to follow.

What Lies Ahead?

In the wake of the Tory Party Conference, there’s been no progress. With France having given Britain until 11th October, all that is left is for Johnson to request an extension.

A number of member states, including a vocal France, continue to be against any further delays.

Boris Johnson would need to demonstrate likely progress in support of an extension request. Simply being forced to make a request as per the newly legislated Benn Act may not be enough.

A general election, however, could give Macron reasonable grounds to support an extension. An extension until 31st January 2020 may be a stretch, however.

For the British PM, a failure to deliver Brexit on 31st October is unlikely to lead to a loss of pro-Brexit voters.

The Benn Act has assured that even in failing to deliver Brexit, Johnson can say that he did his best. Few would contest with such sentiment with just 3-weeks remaining until Halloween.

A General Election

News of Boris Johnson getting election preparations underway will, however, throws the Pound into further uncertainty.

From a Tory perspective, Johnson will hope that there are enough pro-Brexit voters to deliver a no strings attached Brexit. For the EU, this would be the worst-case scenario. Well, for those who have any concerns over a no-deal Brexit and its impact on the regional economy…

For Opposition Party leader Corbyn, a call for a general election will be a judgment day. Having flip-flopped on Brexit, is it self-interest or the interest of the nation that will prevail?

The assumption is that Corbyn may not be able to garner the necessary support to fend off a Johnson victory. Recent polls suggest just that…

As things stand, an EU extension to allow for a UK General Election seems logical. This would allow Britain to address the Brexit Impasse once and for all.

Support for Johnson has been on the rise in the last week. If Corbyn doesn’t step down, it may become a battle between the Tories and the Lib Dems.

Polls from the weekend showed a jump in support for Boris Johnson and the Brexiteers. A tougher stance with the EU and in Parliament has shown that the Remainers and the EU have little regard for Britain’s democratic call to leave.

Johnson has given the Brexit fence-sitters reason to side with the Brexiteers.

For Brexiteers that have shifted in favor of remaining over the last 3-plus years, the general election would appease any claims that the EU Referendum was an inaccurate reflection of the nation’s true democratic view on EU membership.

Of greater significance, in the event of Johnson victory, would be the backfiring of the EU’s plan scupper Brexit altogether.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.