No No-Deal:
There have been interesting developments within Sterling markets overnight and throughout today’s European session. Yesterday, it was decided that the government was in contempt of Parliament for failing to disclose the outcome of the legal advice it has sought. The provision within parliamentary rules was invoked and voted upon given the argument that the failure to disclose the information is preventing or hindering the work of both Houses of Parliament. The legal advice has confirmed exactly what was expected: the flimsy provisions for the Norther Irish Backstop agreement could result in a perpetuation of a state of limbo where the UK never quite fully separates itself from the EU. This could open up a series of repeated negotiations in which the hand of the UK within the European system is seen not to improve despite the expenditure of considerable effort. Despite being negative, the better-than-anticipated news did afford the Pound limited scope to appreciate. Yesterday’s 1.13% fall in the value of the Pound against the US Dollar, shown in the graph below, can be righty attributed to May’s defeat in the House of Commons. The vote of contempt coincided with the assumption of direction by Parliament should May succumb to political pressure and cease to be PM, allowing the Pound to tumble. The Pound retains modest value nonetheless due to the increased improbability of a no-deal Brexit. Given the opinion offered by the European Court of Justice Advocate General yesterday that the UK could unilaterally rescind the Article 50 declaration, thereby ending the UK’s recessionary path, in addition to the power afforded to Parliament should May lose Tuesday’s vote, it becomes less likely that the UK could leave without a deal.
Today’s Global Market:
Discussion and Analysis by Charles Porter
Click Here to Subscribe to the SGM-FX Newsletter
Related Insights
Daily Brief – Fujairah
Humphrey Percy
Fri 22 May 2026
Fujairah For those readers who are less familiar with the Emirate states that make up the UAE, Fujairah, and Ras Al Khaimah are the less glamorous relations of Dubai and Abu Dhabi with low-cost housing, largely immigrant labour accommodation and heavy industry rather than swanky lifestyle and up market shopping malls. With the new oil […]
Daily Brief – Mariannes
Humphrey Percy
Wed 27 May 2026
Mariannes In addition to gold coins such as South African Krugerrands, Canadian Maple Leafs, and American Gold Eagles, from June 16 you will once again be able to buy French Mariannes. The last time France minted gold coins was mostly in the Napoleonic era and appropriately they were called Napoleons and were issued between 1803 […]
Daily Brief – EU capital markets
Humphrey Percy
Mon 1 Jun 2026
EU capital markets As we have written before, for the EUR to become a global reserve currency requires a number of pre-conditions which largely stem from the establishment of an integrated EU Capital Market. Brussels is accused of dragging its feet if not actually being obstructive so the 6 largest countries have banded together to […]
