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Brexit: To vote or not to vote, or cancel the whole thing?

UK Prime Minister Theresa May now has a third option after the European Court of Justice decided Britain can revoke its Article 50 notification.

Theresa May could call it a day on her premiership

Britain can officially revoke its decision to leave the European Union without the consent of the other member states, according to the European Court of Justice’s ruling.

The news comes the day before the UK Parliament will hold a vote on Theresa May’s Brexit deal. However, the prime minister is mulling over postponing the decision day to avoid a humiliating defeat. Instead, May will try to seek concessions at an EU summit this Thursday, 13 December, but EU leaders have already made it clear they had nothing more to offer.

If the vote goes ahead tomorrow, 11 December and May loses, Britain could plunge into political chaos and will head for a disorderly exit in March 2019. It could also trigger a general election, a leadership challenge or even a second referendum.

However, May now has a third option and can cancel Brexit altogether.

Meanwhile, European equity markets opened down this morning as concerns over US-Chinese trade relations are on the rise, pointing out to a wider global economic slowdown and a dip in China’s data.

Following the arrest of Huawei’s chief financial officer Meng Wanzhou in Canada last week in response to a US extradition request, China summoned the US ambassador to Beijing to demand the cancellation of her arrest warrant.

To add pressure to this high-octane situation, the White House’s trade adviser Peter Navarro said on Friday, 7 December the US would proceed with increasing tariffs on Chinese imports if Washington and Beijing could not come to an agreement within a 90-day negotiating period.

The Dollar has slid by almost 0.5 per cent against the Euro and the Yen on the open after soft US payroll data fuelled speculation that the Federal Reserve (Fed) may not raise interest rates next week.

US non-farm payroll figures showed 155,000 jobs were added last month, below economists’ median forecast of 200,000 positions. In addition, the wage increase was softer than expected despite an annual rise remaining near its highest level in almost a decade.

Some Fed policymakers are cautious about the economic outlook, possibly suggesting a turning point in the central bank’s monetary policy.

Related Insights:

May mulls over delaying Brexit vote

Investigation into Huawei adds to US-Chinese trade tensions

 

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