Once again the UK press machine has gone into overdrive
Where to begin with this one eh? UK PM Theresa May has copped some grief from the Sunday Times and others this weekend and there’s more than a fair chance it’s all going to weigh on the pound, either at the Asia open, or when UK traders hit their desks.
What are headlines doing the damage?
- Tory turmoil as 40 MPs say May must go
- Wall Street braced for ‘disorderly Brexit’, warns City
- Halt the Brexit uncertainty, Mrs May, or go now and let Labour sort it out
- May faces defeat by MPs demanding meaningful vote on final Brexit deal
- Boris and Gove’s plot to ‘hijack’ Number 10 exposed
All that’s pretty heavy and hard hitting stuff, even for our tough press. There’s crap flying at May from all angles. Without going chapter and verse into every headline above, here’s the summary.
Supposedly there’s now 40 disgruntled MP’s rallying against May, up from the 35 she had to fight a few weeks ago. There’s even talk from some that the Conservative party needs to be put out its misery and become the opposition, as one minister said;
“It’s a horrible thing to say . . . but we are getting closer and closer to the point whereby we need some time in opposition to regroup.”
Reading the full story, it’s very vague on in depth details but it will be the headline alone that catches the markets eye. The thing with the UK pres is that they like to roll a big gun out to scare everyone but when you look closer, you realise that it’s actually only just about capable of firing water, let alone bullets. Take the “May faces defeat by MPs demanding meaningful vote on final Brexit deal” above. Read the story and all they’ve done is tie the Brexit withdrawal Bill (which goes back into to parliament on Tuesday in what’s called the “Committee Stage”), to these rebel MP’s and the trouble they may try to cause in a vote on the Bill at a later date. This “Committee stage” is one step in the journey of the Bill and it’s just a procedure to add or subtract various parts and clauses that have been previously discussed. Everything will need a final rubber stamp before it then moves on to the next stage to be debated and voted on in the House of Commons. So, in reality, the Brexit Bill happenings on Tuesday, won’t be a inflammatory as the press makes out.
The only real shining light for May was via Brexit Minister David Davis, who gave an very positive interview with Sky this weekend. He gave a very solid performance, including laughing off Barnier’s deadline comment.
What does it all mean?
Again, without jumping into the political analysis, it’s yet another big fat flag for markets that Brexit is still the mother of all messes, and that’s likely to be enough to pressure the pound at the open, and potentially set it back into bearish mode for a while. Theresa May once again has her work cut out for her as she tries to fight fires from the inside. GBP longs may want to watch the Asia open closely tonight, and even if there’s not much change there, it might be a different story when London desks open. Last week I thought that the Barnier ultimatum would have been negative for the pound but it didn’t have an effect. I think all this news coming together will. GBPUSD closed at 1.3189 on Friday.
I’ll end this with a little bit of political analysis but only to say what I’ve long been saying since the Brexit vote. If the UK ends up with a crap deal or hard Brexit, it will be because of the buffoons who sit in our Houses of Parliament. My biggest fear was that party politics would overrule common sense, and that the majority of politicians and parties would fight over Brexit for their own aims and ambitions, and not for those of the country as a whole. The whole of the UK political establishment had a unique and historical opportunity to come together, and work together, to get the best deal possible but as I expected, they’ve ballsed it up because they’re all too pigheaded. So, here we are in the mess we’re in, and no real signs that’s it’s going to change for the better. Would I change my vote to leave given what’s gone on so far, if given a second chance? Not in the least but whatever deal we do end up with, it will be on the heads of every person who sits in parliament, whatever party they belong to.