Christmas is Cancelled! Well, not quite yet, but the reality for Members of Parliament is that a few days of their Christmas break could be revoked next week should the United Kingdom and European Union come to an agreement on a trade deal soon. These rumours began to gather momentum on Monday with speculations within Westminster that Jacob Rees-Mogg as Leader of the House of Commons could recall the House from their Christmas holidays to vote on the important trade deal. Cold water was quickly poured upon these rumours by Number 10 Downing Street and the PM’s office who continued to advise the House and public alike that a no-deal was still the most likely outcome and such end-game preparations were far too presumptuous, even erroneous.
As the week has gone on we have learned of progress on many contentious areas of a post-Brexit trade deal. European Commission President Ursula von der Leyen has briefed MEPs of the progress made on the Level Playing Field and role of the ECJ in deal-enforcement obstacles present in the potential post-Brexit trade deal. Purportedly, therefore, the one major area of a deal that remains unsupported and contentious is fishing. Mr Macron, seemingly at risk of being renamed Mr Maquereau, with his hard-line approach to fishing rights in UK waters, embodies the greatest risk to the UK’s potential trade deal.
The sanguine approach of Ms. von der Leyen this week has been partially met by the Prime Minister when he told MPs yesterday afternoon that there was “every hope, every opportunity” to secure a trade deal with the EU in the coming days. Initially shying away from his role in deal ratification early this week, Mr Rees-Mogg is also thought to have briefed colleagues that should a deal be agreed this week, he would pave the way in the parliamentary calendar for MPs to pass emergency legislation to approve the deal.
The bill that has been provisionally dubbed the “future relationship bill” would be expected to get a whistle stop tour of the Palace of Westminster. Starting with one day and one night on Monday in the Commons the bill would be whisked through the Central Lobby and onto the Lords’ chambers for a one day consultation on Tuesday to allow for Her Majesty to grant Royal Assent to the deal the following day, all in time for Christmas Eve. Sterling sits at two-year highs versus the US Dollar on the back of this positive trade rhetoric. GBPUSD has also been encouraged higher by the Federal Reserve’s dovish monetary policy announcement yesterday evening.
Discussion and Analysis by Charles Porter