Brexit negotiations have been a focal point for the currency markets, ever since June 2016 when the referendum vote resulted in the British electorate voting 52% - 48% in favour of leaving the EU. Since that date the pound has experienced almost constant volatility with relatively small updates to Brexit negotiations.
Take a look at the timeline of Brexit events, back to where it all started in February 2016 when David Cameron announced that there would be a vote put to the British electorate to decide whether or not the UK would stay in the bloc.
An extension of article 50 has been granted by the EU until the 12th April allowing for another meaningful vote.
The Prime Minister is still looking for the numbers to vote on her deal, indicating that she may not bring the deal back to Parliament if there is still a lack of support.
In the final stages of the Brexit the pound looks highly unsettled due to so much uncertainty over Britain's departure from the EU.
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The next Brexit vote in the House of Commons is due to take place this evening. This will follow the motion of a no deal that will be put forward to Parliament at 2:30 pm today.
This is another key event in what as been a busy week for Brexit news, and a volatile period for Sterling exchange rates.
Tonight's vote will give a clear indication of whether MPs are willing to allow the UK to leave the EU without a deal in place.
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It’s an important week for UK Prime Minister Theresa May and the ongoing Brexit saga.
The next key date on the Brexit timeline is Tuesday 12th of March, the House of Commons will vote on whether or not to accept the Brexit deal currently on offer from the EU. The previous meaningful vote on the 15th of January resulted in an overwhelming rejection of the deal. If this is the case, this could create further uncertainty and history tells us the pound could therefore come under pressure.
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12th April - The Brexit deadline extension until the 31st October is comfirmed. This is with the understanding that if a deal can be reached in the meantime, the UK is free to leave and can move on the next stage of negotiations.
11th April - Overnight, EU leaders offer the UK a longer-term extension to Article 50, this time until the 31st October.
29th March - The original date the UK was due to leave the EU. Instead another vote - this time on the Brexit withdrawal agreement element of Article 50 rather than the political statement - goes to Parliament. If this vote is not passed, further possible routes the Brexit saga could take are a general election, long extension to the leave date, or a no deal Brexit on 12th April which remains the default position.
28th March - House of Commons Speaker John Bercow again states that the current deal cannot be brought back for a third meaningful vote, but Parliament find a workaround for this and will vote on the withdrawal agreement rather than the political statement.
27th March - A number of indicative votes are held in Parliament on alternative Brexit options, none of which win an outright majority. PM May meets with the 1922 Committee. Rumours emerge that the Prime Minister will quit her post if her deal is passed through Parliament. These rumours were later confirmed by Theresa May. This led to Boris Johnson and Jacob Rees-Mogg both having a change of heart and stating that they would vote for her plan if it went to a third meaningful vote. John Bercow however states that this would not be allowed to return for a third time unless there have been sufficient amendments made.
21st-22nd March - The EU Summit – it’s been agreed between Theresa May and the President of the European Commission, Jean-Claude Juncker that Brexit negotiations should be wrapped up by this point.
13th March - If Theresa May’s amended Brexit deal is rejected during the Parliamentary vote on this date, there will be a vote on whether or not the UK Government should push on with a No Deal Brexit.
14th March - If previous votes held on the 12th and 13th are both rejected by Parliament, the next vote will be to decide if PM May should seek an extension to Article 50 past the 29th of March deadline.
It’s been stated by PM May that as the next round of European Parliamentary elections begins in July, any extension sought with the EU should not run on any longer than the end of June.
12th March - The Labour Party has said they will put forward an amended for another referendum at the same time as the next meaningful vote due no later than the 12th of March. It isn’t expected that there will be enough support to carry this through.
15th January - Theresa May’s amended Brexit deal will be voted on by the House of Commons.
9th January - Negotiations are due to begin in Parliament on January the 9th 2019, with the vote due to take place before 21st of January.
7th January - Parliament returns to work on Brexit after the Christmas recess.
29 October - Chancellor Philip Hammond’s attempts to reassure the British voters by ignoring his usual cautious approach and stating that “austerity is coming to an end” during his 2018 budget speech seemingly fell on deaf ears. As a result, the pound’s value fell to just above a two month low against the US dollar.
18 October - Donald Tusk, the president of the European Council, warns that “not enough progress” has been made on the Brexit deal at an EU summit in Brussels.
20 September - Theresa May puts her Brexit strategy in front of EU leaders, who comprehensively reject it and give her 4 weeks to rewrite her plan. Sterling’s value falls against both the euro and US dollar.
9 July - David Davis – Brexit Secretary – unexpectedly resigns and is immediately replaced by Dominic Raab. Davis’ states that his reason for resigning is that the UK is ‘giving away too much and too easily’ to the EU. This increases the expectations for a ‘soft Brexit’ which lends some support to the pound against the US dollar and the euro.
6-7 July - The Chequers Deal is agreed – the future relationship between the UK and EU is agreed by the Cabinet, including a free trade area for good and a new customs agreement.
15 December - Phase 1 complete – the EU agrees with the proposal made by the UK and European Commission to move to phase 2 of negotiations after it’s deemed that sufficient progress has been made with the first stage.
13 December: The Government is defeated by a small margin in the vote to secure legal assurance that MPs will be given a vote on the final Brexit deal struck between Theresa May and Brussels. 11 Conservative MPs rebel against their Party to deliver this final result.
25 June - PM May strikes up a coalition Government with the DUP, now that the Conservatives no longer have the numbers to govern on their own.
19 June - First round of formal withdrawal negotiations begins between the UK and the EU.
8 June - The Conservative Party’s hopes of an easy victory are dashed as the votes are counted. The PM loses her overall majority (and would later be forced to join the Democratic Unionist Party (DUP) to form a coalition Government to retain her position). This happens less than 2 weeks before the UK is due to commence with Brexit negotiations. The new, unnerving prospect of a hung Parliament cause the pound to dip by 2%.
7 April - Theresa May goes against her word and calls a snap general election for 8 June. Having said previously that she wouldn’t call an election until the scheduled 2020 poll. PM May goes on to seek a new mandate to implement, upholding her word in one sense.
29 March - 279 days after the vote on Brexit, the date the UK is due to formally leave the EU is set out in a letter from PM May to Brussels. This officially triggers Article 50 and begins two year process of leaving the bloc. The pound remains under pressure as the uncertainty continues.
September-October - The political uncertainty continues as UK Government try to ascertain whether or not PM May can legally initiate Article 50 without Parliamentary approval. The pound’s value falls from €1.1579 to €1.1044; 4.6% between the 30th of September to the 11th of October. It would late be decided by the High Court that the House of Commons and the House of Lords will need to approve the law in order for Article 50 to be triggered.
13 July - Following David Cameron’s swift exit from Government, Former Home Secretary Theresa May fills his spot and vows to “make a success” of Brexit.
24 June - The result of the vote is released; the British electorate have backed to leave the EU by 52% to 48%. Many are surprised by the lack of last-minute swing from the remain voters, including David Cameron who resigns straight away once the realisation that the British people voted against him campaign. As a result of this, sterling’s value falls to a 31 year low against the US dollar.
23 June - 43 year after joining the bloc, the first ‘leave’ referendum is held in the UK, the result of which remains too close to call. The pound continues to experience considerable volatility as a result of the uncertainty of the result.
February-June - considerable volatility is caused for the pound, due to the toing and froing of a number of conflicting Brexit opinion polls. This goes to show the uncertain nature of the outcome of the referendum vote in June.
20 February - Boris Johnson states his support for the Leave Campaign, which comes as a surprise to some. Sterling’s value is impacted by the uncertainty caused by the Mayor of London’s statement.
19 February - David Cameron informs the UK that the EU referendum is due on the 23rd of June. He also states that he aims for the UK to stay in a reformed EU.
If you have any questions about how Brexit is impacting exchange rates, please contact the team here at Foreign Currency Direct using the form below:
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