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| Pound hits 20-month low against US dollar as Brexit confusion swirls – business live | |
| (35 minutes later) | |
| The pound has fallen further against the euro too. Now down 1.4%, or one and a half eurocents, at €1.1014. | |
| That means the euro is worth 90.7p, its strongest position since late August. This makes imports from Europe more expensive, and UK exports more competitive. | |
| So much for Theresa May’s speech being priced in! This chart shows how sterling has taken a deeper bath, as MP after MP criticise the PM’s handling of the Brexit negotiations. | |
| Boom! The pound is in freefall.....dropping to a new 20-month low of $1.2555 against the US dollar. | |
| That’s a loss of 1.4%, down 1.8 cents today. | |
| The latest drop comes as Labour leader Jeremy Corbyn responds to Theresa May. | |
| Corbyn lashes the government for being in “complete disarray”, and argues that the House of Commons should set the mandate for the PM’s new talks with the EU. | |
| Corbyn demanding that May allows parliament to set the terms of her coming negotiation with EUCO. | |
| Corbyn: “Extremely serious and unprecedented situation. The Government has lost control of events and is in complete disarray” pic.twitter.com/Y0zlERbhSZ | |
| and we're below 1.2600 #gbp | |
| The PM’s position in a nutshell: | |
| PM goes on offensive. She says those backing 2nd ref must 'be honest' that this risks dividing country again. If you want to stay in SM + CU this will require free movement & Budget contributions.If you want no deal this will cause significant economic damage. | |
| Theresa May is now challenging MPs to support her deal, calling for compromise. | |
| She says MPs must admit that a second referendum risks dividing the UK again, that single market membership means maintaining free movement of people, and no deal would cause economic damage. | |
| But, the House of Commons sounds as divided as ever.... | |
| 'Does this house want to deliver Brexit?' says May'NO!' comes the cry pic.twitter.com/wMx3p4u0MA | |
| The Brexit problem here in Westminster summed up in a moment - PM says House faces fundamental question, do we want to deliver Brexit? SNP benches and some on Labour backbenches shout “NO”! Most laugh. Except it’s not really that funny. | |
| Theresa May has confirmed that the government has decided to defer the Brexit vote scheduled for tomorrow. | Theresa May has confirmed that the government has decided to defer the Brexit vote scheduled for tomorrow. |
| The PM says there is ‘broad support’ for much of her deal (cue heckling from the opposition benches), but also admits that the government would lose the vote, due to concern over the Irish backstop. | The PM says there is ‘broad support’ for much of her deal (cue heckling from the opposition benches), but also admits that the government would lose the vote, due to concern over the Irish backstop. |
| She tells MPs that both sides are “legally committed to using best endeavours” to ensure the backstop is never used, and that any use would only be temporary. | She tells MPs that both sides are “legally committed to using best endeavours” to ensure the backstop is never used, and that any use would only be temporary. |
| [Reminder: the backstop would ensure no hard border in the island of Ireland, if the UK and EU can’t agree a permanent trade deal at the end of a post-Brexit transition deal] | [Reminder: the backstop would ensure no hard border in the island of Ireland, if the UK and EU can’t agree a permanent trade deal at the end of a post-Brexit transition deal] |
| Given the “clear concerns” of the House of Commons, May adds, she plans to meet fellow EU leaders in the coming days to press for more reassurances on the backstop [many MPs fear that the UK could be trapped permanently]. | Given the “clear concerns” of the House of Commons, May adds, she plans to meet fellow EU leaders in the coming days to press for more reassurances on the backstop [many MPs fear that the UK could be trapped permanently]. |
| There’s not much financial reaction -- the pound is still trading around $1.262, an 18-month low, down one cent today. | There’s not much financial reaction -- the pound is still trading around $1.262, an 18-month low, down one cent today. |
| This morning’s leaks mean that today’s announcement is already priced in.... | This morning’s leaks mean that today’s announcement is already priced in.... |
| Theresa May is giving her statement to the House of Commons now. | Theresa May is giving her statement to the House of Commons now. |
| Our Politics Live blog will have full coverage. I’ll track financial reaction to the key points. | Our Politics Live blog will have full coverage. I’ll track financial reaction to the key points. |
| May makes Commons statement after No 10 shelves key Brexit vote - Politics live | May makes Commons statement after No 10 shelves key Brexit vote - Politics live |
| Theresa May has been working the phones....but not finding many friends at the other end of the line. | Theresa May has been working the phones....but not finding many friends at the other end of the line. |
| Just off call with PM. Expressed my deep frustration that the interests of a divided Tory party are taking priority over the interests of country and that delaying the vote is an abdication of responsibility, leading to even greater chaos. | Just off call with PM. Expressed my deep frustration that the interests of a divided Tory party are taking priority over the interests of country and that delaying the vote is an abdication of responsibility, leading to even greater chaos. |
| The Sun’s political editor, Tom Newton Dunn, has tweeted that MPs might not get to vote on Theresa May’s Brexit deal until 2019. | The Sun’s political editor, Tom Newton Dunn, has tweeted that MPs might not get to vote on Theresa May’s Brexit deal until 2019. |
| Latest: I am told the PM will tell MPs she will not dump the backstop or reopen the Withdrawal Agreement, but instead seek legal assurances from the EU that it will not last indefinitely (1) | Latest: I am told the PM will tell MPs she will not dump the backstop or reopen the Withdrawal Agreement, but instead seek legal assurances from the EU that it will not last indefinitely (1) |
| PM will also say the meaningful vote will be suspended, indefinitely, until that happens. So, could well be not vote until after Xmas. Even if May succeeds, will it be enough to win over the DUP and ERG? (2) | PM will also say the meaningful vote will be suspended, indefinitely, until that happens. So, could well be not vote until after Xmas. Even if May succeeds, will it be enough to win over the DUP and ERG? (2) |
| If so, that wouldn’t calm the financial jitters dragging down the pound. | If so, that wouldn’t calm the financial jitters dragging down the pound. |
| More pressure on the PM, from the head of the DUP - who have been propping her government up since the 2017 election. | More pressure on the PM, from the head of the DUP - who have been propping her government up since the 2017 election. |
| Just finished a call with the Prime Minister. My message was clear. The backstop must go. Too much time has been wasted. Need a better deal. Disappointed it has taken so long for Prime Minister to listen. | Just finished a call with the Prime Minister. My message was clear. The backstop must go. Too much time has been wasted. Need a better deal. Disappointed it has taken so long for Prime Minister to listen. |
| Andy Scott, Associate Director at financial risk management consultancy JCRA, fears the pound will suffer further losses as the Brexit drama plays out: | Andy Scott, Associate Director at financial risk management consultancy JCRA, fears the pound will suffer further losses as the Brexit drama plays out: |
| Theresa May is reported to be planning to travel to Brussels to seek a legally-binding assurance on the back stop, in an attempt to gain support of MPs who fear being trapped indefinitely under the current proposal. | Theresa May is reported to be planning to travel to Brussels to seek a legally-binding assurance on the back stop, in an attempt to gain support of MPs who fear being trapped indefinitely under the current proposal. |
| But with her authority severely depleted, the political stakes are high for May whose position as Prime Minister could soon be deemed untenable. | But with her authority severely depleted, the political stakes are high for May whose position as Prime Minister could soon be deemed untenable. |
| “The uncertainty will meanwhile continue to exert downwards pressure on Sterling.” | “The uncertainty will meanwhile continue to exert downwards pressure on Sterling.” |
| One well-connected source floats the possibility of a joint letter signed by the British and Irish governments to spell out what would constitute acceptable alternative arrangements to the backstop | One well-connected source floats the possibility of a joint letter signed by the British and Irish governments to spell out what would constitute acceptable alternative arrangements to the backstop |
| The slump in the pound today shows that international investors are losing faith in Theresa May’s government, says the BBC’s Simon Jack: | The slump in the pound today shows that international investors are losing faith in Theresa May’s government, says the BBC’s Simon Jack: |
| Q: Why is the value of pound falling? FX traders A: "when international investors see government in crisis they go away till there's crumb of clarity". Q: Does it make no deal more likely? A: The single line of least resistance (no one has to do anything) is no deal. | Q: Why is the value of pound falling? FX traders A: "when international investors see government in crisis they go away till there's crumb of clarity". Q: Does it make no deal more likely? A: The single line of least resistance (no one has to do anything) is no deal. |
| MPs are due to hear from Theresa May in less than 30 minutes time, in what’s certain to be a testing appearance at the dispatch box. | MPs are due to hear from Theresa May in less than 30 minutes time, in what’s certain to be a testing appearance at the dispatch box. |
| Paul Hardy, Brexit director at legal firm DLA Piper, argues that the pain may not be worth it: | Paul Hardy, Brexit director at legal firm DLA Piper, argues that the pain may not be worth it: |
| “The political cost to Theresa May of delaying the vote could only be justified if she can come back from Brussels with significant changes to the draft Withdrawal Treaty - this is the legally binding document which puts the Irish backstop in place. | “The political cost to Theresa May of delaying the vote could only be justified if she can come back from Brussels with significant changes to the draft Withdrawal Treaty - this is the legally binding document which puts the Irish backstop in place. |
| This seems unlikely if the comments of the European Commission President, Jean-Claude Junker, made at the time the deal was adopted are taken at face value: “This is the best deal possible. I’m inviting those who have to ratify this deal in the House of Commons to take this into consideration. This is the best deal for the UK, the best deal for Europe, this is the only deal possible”.” | This seems unlikely if the comments of the European Commission President, Jean-Claude Junker, made at the time the deal was adopted are taken at face value: “This is the best deal possible. I’m inviting those who have to ratify this deal in the House of Commons to take this into consideration. This is the best deal for the UK, the best deal for Europe, this is the only deal possible”.” |
| At today’s 18-month low of $1.261, the pound in your pocket is worth 15% less than on the day of the EU referendum. | At today’s 18-month low of $1.261, the pound in your pocket is worth 15% less than on the day of the EU referendum. |
| However, it’s still stronger than in the aftermath of the vote; sterling hit a 31-year low below $1.20 in January 2017, before managing a small recovery. | However, it’s still stronger than in the aftermath of the vote; sterling hit a 31-year low below $1.20 in January 2017, before managing a small recovery. |
| And in historical terms, it’s just one more devaluation in a series of sterling crises.... including Black Wednesday in 1992, the Wilson devaluation in 1967, the 30% devaluation by the Attlee government, the end of the gold standard.... | And in historical terms, it’s just one more devaluation in a series of sterling crises.... including Black Wednesday in 1992, the Wilson devaluation in 1967, the 30% devaluation by the Attlee government, the end of the gold standard.... |
| The pound is tumbling again today. But a glance back through history shows this is hardly the first time - or indeed the biggest falls. Presenting sterling vs the dollar since 1870: pic.twitter.com/55z4wwkYXm | The pound is tumbling again today. But a glance back through history shows this is hardly the first time - or indeed the biggest falls. Presenting sterling vs the dollar since 1870: pic.twitter.com/55z4wwkYXm |
| We also have fresh evidence that all the Brexit uncertainty is weighing on the economy. | We also have fresh evidence that all the Brexit uncertainty is weighing on the economy. |
| The National Institute of Economic and Social Research has estimated that UK growth will slow to 0.4% in the current quarter, down from 0.6% in July-September. | The National Institute of Economic and Social Research has estimated that UK growth will slow to 0.4% in the current quarter, down from 0.6% in July-September. |
| That follows official data this morning, showing that UK manufacturing shrank in October, and that the wider economy only grew by 0.1% last month. | That follows official data this morning, showing that UK manufacturing shrank in October, and that the wider economy only grew by 0.1% last month. |
| OUT NOW:Our latest monthly #GDP Tracker suggests that UK economic #growth is set to slow to a quarterly rate of 0.4% in 2018Q4 from 0.6% 2018Q3 - Read here in full: https://t.co/UTIU0b4ECr | OUT NOW:Our latest monthly #GDP Tracker suggests that UK economic #growth is set to slow to a quarterly rate of 0.4% in 2018Q4 from 0.6% 2018Q3 - Read here in full: https://t.co/UTIU0b4ECr |
| Sterling’s weakness isn’t helped by confusion over whether Theresa May can actually scrap tomorrow’s vote or not! | Sterling’s weakness isn’t helped by confusion over whether Theresa May can actually scrap tomorrow’s vote or not! |
| Govt whips apparently confident they can delay the vote - but it may be when the try that the 'house erupts' - according to one MP | Govt whips apparently confident they can delay the vote - but it may be when the try that the 'house erupts' - according to one MP |
| The PM does not get to pull a vote. The House will have to vote to pull a vote. I will oppose. We need to see this deal off once and for all. | The PM does not get to pull a vote. The House will have to vote to pull a vote. I will oppose. We need to see this deal off once and for all. |
| However, the government may use parliamentary procedure to avoid the humiliation of losing a vote on whether to cancel its own vote. | However, the government may use parliamentary procedure to avoid the humiliation of losing a vote on whether to cancel its own vote. |
| My colleague Jessica Elgot explains: | My colleague Jessica Elgot explains: |
| A government source has said that there won’t be a vote on a business motion to cancel Tuesday’s vote. (See 1.38pm.) “We are replacing the business with a new statement but it isn’t a motion and therefore isn’t voteable,” the source said. | A government source has said that there won’t be a vote on a business motion to cancel Tuesday’s vote. (See 1.38pm.) “We are replacing the business with a new statement but it isn’t a motion and therefore isn’t voteable,” the source said. |
| Reminder: Our Politics Live blog has all the latest from Westminster (I’m tracking the financial reaction here...) | Reminder: Our Politics Live blog has all the latest from Westminster (I’m tracking the financial reaction here...) |
| Brexiters claim May's plan defeated after No 10 shelves key vote - Politics live | Brexiters claim May's plan defeated after No 10 shelves key vote - Politics live |
| A further burst of selling pressure is threatening to send sterling below $1.26, for the first time since June 2017. | A further burst of selling pressure is threatening to send sterling below $1.26, for the first time since June 2017. |
| As you can see, the pound has suffered a series of sickening jolts in the last few hours, since news broke that Theresa May was holding an emergency call with the cabinet. | As you can see, the pound has suffered a series of sickening jolts in the last few hours, since news broke that Theresa May was holding an emergency call with the cabinet. |
| The latest chatter in Westminster is that May plans to return to Brussels, in search of a better deal (given the torrent of criticism over the Irish backstop). | The latest chatter in Westminster is that May plans to return to Brussels, in search of a better deal (given the torrent of criticism over the Irish backstop). |
| PM expected to say that she's listened to concerns about the backstop and is heading back to Brussels. | PM expected to say that she's listened to concerns about the backstop and is heading back to Brussels. |
| Sources tell me PM will return to Brussels in an attempt to renegotiate the backstop. Statement at 3.30. | Sources tell me PM will return to Brussels in an attempt to renegotiate the backstop. Statement at 3.30. |
| .... meanwhile, the leader of the Scottish Nationalist Party, Nicola Sturgeon, has publicly called for a vote of no confidence in the government. | .... meanwhile, the leader of the Scottish Nationalist Party, Nicola Sturgeon, has publicly called for a vote of no confidence in the government. |
| So @jeremycorbyn - if Labour, as official opposition, lodges motion of no confidence in this incompetent government tomorrow, @theSNP will support & we can then work together to give people the chance to stop Brexit in another vote. This shambles can’t go on - so how about it? | So @jeremycorbyn - if Labour, as official opposition, lodges motion of no confidence in this incompetent government tomorrow, @theSNP will support & we can then work together to give people the chance to stop Brexit in another vote. This shambles can’t go on - so how about it? |