The UK’s departure from the European Union is still no clearer after Parliament rejected all four Brexit alternatives put before them in the House of Commons last night.
With Britain currently set to leave the EU on April 12th, four potential “Plan B”‘s were voted on in Parliament last night, including a referendum on the deal and the Labour-backed Common Market 2.0. None were favoured by a majority of MPs.
Go deeper with GlobalData
Expert reaction to rejection of Brexit alternatives
According to UBS’ UK economist Dean Turner, sterling will feel the effects of the ongoing uncertainty thanks to Parliament’s rejection of all four Brexit alternatives.
“We expect the pound to remain susceptible to volatility as each stage of the increasingly protracted Brexit process is unveiled.
“We believe it is prudent to tread cautiously while the news is fast-flowing and do not advocate taking directional views on the currency.
“However, we remain alert to entry and exit opportunities if persistent volatility results in disproportionately large moves.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“For the time being, the most sensible approach seems to be to hedge sterling’s downside risks in the event of a no-deal.”
UBS reiterate their view that a long extension to Article 50 will be Theresa May’s only option, which will also make a general election increasingly likely.
Majority for any of the Brexit alternatives would have been beneficial
Nigel Green, CEO of deVere group, believes the pound will flatline.
“MPs have failed to find a way out of the UK’s Brexit crisis, rejecting a series of alternative strategies in the House of Commons.
“Sterling and UK assets can be expected to flatline [until] there is a parliamentary consensus on how to move forward with Brexit.
“The UK economy would be benefited if there had been a clear majority of any of the four motions. There would have been a likely boost as household spending and investment that has been on the sidelines is unleashed.
Green warns that that MPs failure to deliver a consensus on the mode of Brexit’s impact on business could last a generation.
The deVere CEO also speaks of the importance of portfolio diversification to mitigate risk and remain agile enough to capitalise on opportunities once some sort of Brexit roadmap is in place.
