UK: Politics at the forefront – Danske Bank

Jakob Christensen, chief analyst at Danske Bank, points out that in the UK, Prime Minister Theresa May yesterday proposed to give Parliament a vote on whether to call another referendum to ratify Britain’s divorce from the EU conditional on MPs backing her overall withdrawal bill first.

Key Quotes

“The proposal seemed to have little effect in winning over sceptics, with prominent Brexiteers, such as conservative MP Boris Johnson and Labour Party leader Jeremy Corbyn, and May’s Northern Irish allies condemning her proposal. Indeed, consensus is increasingly shifting towards a scenario where either Brexiteer Boris Johnson or Labour’s Corbyn is set to take the UK through some form of Brexit and both are seen by markets as pound-negative.”

“In reality, we will not have more certainty before May steps down and domestic politics is reshuffled. Either candidate may indeed show to be more pragmatic but for now a bit more pound volatility has been introduced.”