Theresa May has suffered a setback after the House of Lords voted in favour of making two amendments to the Brexit bill.
Peers have voted in favour of protecting EU citizens’ rights who are residing in the UK post-Brexit and also that Parliament must give their approval to the final exit bill.
The bill will now be returned to the House of Commons for approval.
This could create a scenario of political ping pong which could cause a delay on the invocation of Article 50, something Theresa May is trying to avoid at all costs. If there is a delay in the triggering of article 50 it will add further uncertainty to the exit process and currency markets do not react well to uncertainty, we could see further falls for Sterling.
Sterling had a torrid time during Friday’s trading dropping below 1.14 on news the IMF will be putting together a new bail out plan for the Greeks.
Thursday will see the Bank of England Interest (BoE) Rate decision. I would be very surprised to see any movement from the current 0.25% level. The monetary policy committee (MPC) last made a change on 4th August 2016 following the Brexit announcement. Some consider this to be a rash decision, but I would say it was a wise move trying to stimulate growth when the future of the UK economy is so uncertain.
It will be interesting to see how the MPC vote. If there is any change on how the nine members vote there could be movement In Sterling value. At last month’s meeting all nine members voted in favour of keeping rates on hold.
Following the Interest rate decision we have the BoE minutes, this will give an indication as to how the BoE judge the health of the economy and may give a hint to monetary policy going forward. Such hints have been known to move markets in the past. Make your broker aware if you have a currency requirement before the event so they can assist in timing your trade.
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