Pound touches 2017 lows because of Brexit – The Economic Journal


The pound trades on the $ 1.20 bar, set at 2017 lows, due to political turmoil in the UK, notably as Brexit approaches and early elections are possible. By 9:30 am in Lisbon, the British currency was falling 0.52% to $ 1.20.

The British Parliament decides on Tuesday the possible introduction of new legislation allowing a further postponement of Brexit if Prime Minister Boris Johnson fails to negotiate a new agreement with the European Union by 31 October – date planned for the UK to exit the EU.

Labor MPs and other opposition parties, including some from the Conservative party, will urgently call for a debate to try to gain control of the parliamentary agenda.

If granted, they will introduce a bill to force the prime minister to request an extension of the Brexit process by January 31, said Labor Hilary Benn, the first signatory to the proposal.

“The purpose of the bill is to ensure that the United Kingdom does not leave the European Union on October 31 without an agreement, unless the parliament consents. The bill gives the government time to reach a new agreement with the European Union at the European Council [de 17 e 18 de outubro]”, Creased, through the social network Twitter.

The text requires that by 19 October the British Prime Minister be obliged to give MPs the options to approve an exit agreement, to approve an exit without agreement or to request a further extension of the departure date beyond 31. of October.

However, British Prime Minister Boris Johnson does not want to be challenged and has already made it clear that if parliament moves forward with the bill, the UK will enter early elections on October 14. This scenario may “lead the pound / dollar currency pair to a new low,” predicted the Sales Team Leader of brokerage firm XTB, Carla Maia Santos, in her daily market analysis.

“In this instability, the pound against the dollar touches the support created by the January 2017 lows, assuming the possibility of creating a double fund at the technical level,” he explained.

On Monday, September 2, in a statement on the doorstep of the Prime Minister's official residence in Downing Street, Boris Johnson urged MPs not to support the Labor party initiative, arguing that negotiations for a new deal are at stake. with Brussels.

After a summer break, the British Parliament returns to work on issues with Foreign Minister Dominic Raab. The opening of the parliamentary session is scheduled for 2.30 pm Lisbon time.

Even today, the prime minister may make a statement at the Palace of Westminster on the G7 summit.

Also today there is a court hearing in Edinburgh, Scotland, to consider the request for a precautionary measure to block the suspension of the British Parliament scheduled to begin next week and last five weeks, precisely until 14 October.



Source link