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You can find the current article at its original source at https://www.theguardian.com/business/live/2018/dec/10/stock-markets-trade-war-growth-fears-uk-gdp-business-live
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Pound hits 20-month low against US dollar as Brexit confusion swirls – business live | Pound hits 20-month low against US dollar as Brexit confusion swirls – business live |
(35 minutes later) | |
Lee McDarby, Corporate IP Managing Director at foreign exchange firm moneycorp, says Theresa May’s decision to delay the Brexit vote will hurt the economy: | |
“Over the course of the afternoon we’ve seen wild swings in the value of Sterling, including a 20 month low against the dollar. | |
Every time the Prime Minister kicks the can down the road, the uncertainty dents British business plans for 2019. Right now it seems the markets are just looking for some certainty on the future of the UK, regardless of its shape or form.” | |
The pound’s thumping today suggest that investors see a growing danger that the UK crashes out of the EU at the end of March, without a transition deal. | |
But a sterling crisis might encourage MPs to back Theresa May’s deal, despite all their misgivings. | |
Silvia Dall’Angelo, senior economist at Hermes Investment Management, believes all options are still on the table -- from crashing out without a deal, to not leaving at all. | |
In our – admittedly low confidence – base case, stress in financial markets and pressure from businesses should lead to a last-minute approval of the deal in Parliament. | |
However, the situation is fluid and other outcomes carry significant probabilities. | |
Prime Minister May highlighted the government would step up preparations for a no-deal Brexit, but a second referendum, a soft Brexit (Norway-style) or a no-Brexit scenarios seem more realistic, especially following the European Court of Justice’s ruling this morning that the UK can unilaterally reverse Article 50. | |
The pound has fallen further against the euro too. Now down 1.4%, or one and a half eurocents, at €1.1014. | 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. | 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. | 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. | 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. | 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. | 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 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 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 | 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 | and we're below 1.2600 #gbp |
The PM’s position in a nutshell: | 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. | 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. | 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. | 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.... | 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 | '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. | 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. |