Talking Points:
- Brexit is out of the headlines for now thanks to the Easter holiday. All of that will change next week when UK parliament reconvenes on April 23.
- Cross-party talks between Labour and Tory leadership appear doomed to fail; a general election may be around the corner.
- Recent positioning changes draw into question the British Pound’s ability to sustain anything more than a short-term relief rally.
Looking for longer-term forecasts on the British Pound[1]? Check out the DailyFX Trading Guides[2].
Traders have been able to ignore the Brexit mess for the past few days, particularly as UK parliament is out of session until April 23 due to the Easter holiday. But as the end of the week comes into focus – tomorrow is effectively the last day for Europe, given the closure for Good Friday – traders should start thinking about what will come next in the Brexit process once markets resume full steam ahead after Easter Monday.
Next Steps in the Brexit Timeline: April
By the end of April: Now that the European council has agreed to extend the Brexit deadline to October 31, 2019 with a check-in at the end of June, UK Prime Minister Theresa May and Labour party leader Jeremy Corbyn have continued cross-party talks. The goal is to find enough common ground to whip the votes for the EU-UK Withdrawal Agreement to pass through UK parliament. Early indications from both Labour and Tory party officials suggest that the talks will result in very little.
If ‘no’ cross-party deal (most likely outcome): Tory party leader May could step down as prime minister. If so, this would trigger a new
