Forex GBP/USD

MPs accept the “Withdrawal Agreement Bill”; Reject the timeline

  • The UK's House of Commons voted in favor of the Withdrawal Agreement Bill (329 to 299 votes).
  • "Programme Motion" that fast-tracked the deal to be realized by the deadline was rejected.
  • PM Johnson requested the EU for Brexit extension till January 31st in compliance with the Benn act.
  • President of the European Council, Mr. Donald Tusk, to recommend EU27 to accept the UK's request.
  • PM Johnson expected to call for an election in an event of further delay on Brexit.

Following the Second Reading vote in the UK’s House of Commons on the Withdrawal Agreement Bill (WAB) on Tuesday, October 22nd, 2019 that was previously presented by Prime Minister Boris Johnson sources have informed that the approval for the bill was only partial. While the bill has received the majority vote from the MPs (329 to 299 votes), the timeline for realization of the Brexit deal as highlighted in the “Programme Motion” that was presented by the government twenty minutes after receiving the approval for the bill, was immediately rejected by the MPs (308 to 322 votes).

Programme Motion Was Crucial To Meet The Brexit Deadline

According to the financial experts, approval of the bill is a major victory for Mr. Johnson since it’s the first time in history that a Brexit deal in principle has been agreed upon in the House of Commons. On the other hand, however, rejection of the Programme Motion creates a hindrance since its approval was imperative for the deal to be realized within the quickly approaching deadline of October 31st, 2019.

The MPs of prominence in yesterday’s proceedings in the UK’s Parliament included the DUP members, ex-Tory rebels, and Labor MPs in favor of Brexit. As many as nineteen MPs from the Labor party were reported to have supported the withdrawal agreement bill. However, only five voted in favor of the Programme Motion with nine of the ex-Tory MPs, including Mr. Philip Hammond, ex-chancellor, voting against it. Ten MPs from the Democratic Unionist Party (DUP) of Northern Ireland were in favor of neither the deal nor the timeline.

Against his will, PM Johnson has already sent a letter to the EU requesting an extension on Brexit till January 31st, following the passage of the Letwin Amendment on Saturday and in order to comply with the Benn act. The President of the European Council, Mr. Donald Tusk was reported stating that he would recommend the leaders of the EU to approve the UK’s request for a delay; in which case the Prime Minister is expected to call for elections.

Response In The Forex Market

Since the proceedings of the UK’s House of Commons continued to fuel the uncertainty regarding Brexit, it was not well received in the Forex market. The GBP/USD pair was reported to have fallen from around 1.30 level to 1.2875 within a matter of an hour. The pair made a daily low of 1.2861. Following a further drop to around 1.2850 level earlier this morning, it is currently trading at 1.2860.

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